11.

Hedge accounting means that

Select one:

A. the financial derivative is marked to market together with the asset (liability) to which it relates and unrealized gains and losses on fair value hedges are immediately reflected in net income.

B. the financial derivative is reported on the balance at fair value, but no gains and losses are recognized, thus reducing income volatility.

C. the financial derivative is marked to market together with the asset (liability) to which it relates and unrealized gains and losses are always reflected in net income.

D. the financial derivative is marked to market together with the asset (liability) to which it relates and unrealized gains and losses on cash flow hedges are immediately reflected in net income.

17.

Which of the following is not a proprietary fund?

Select one:

A. Enterprise fund

B. Internal service fund

C. Pension trust fund

D. All of the above are proprietary funds.

18.

Which of the following describes the accounting for changes in accounting principles and estimates?

Select one:

A. In order to maintain comparability of the financial information across interim reporting periods, the FASB recommends that companies adopt any accounting changes during the first interim period of a fiscal year.

B. Whenever a change in accounting principles is made, accounting standards require that the change be made retrospectively, with a cumulative adjustment to the beginning balance of assets and liabilities affected by the change in the earliest period reported, and an offsetting adjustment to Retained Earnings.

C. When a change in accounting principle is made in an interim period, the effect of the change on prior interim periods should be made retrospectively by adjusting each prior interim financial statement for the effects of the change.

D. All of the above

E. Both A and C

19.

Which of the following best describes an enterprise fund?

Select one:

A. An enterprise fund is a governmental activity that is available to the public and is financed, in whole or in part, by general tax revenue.

B. An enterprise fund is a business-like activity.

C. An enterprise fund is a central operation, like a copy center, that provides service to many governmental departments for a fee.

D. Both A and B