1.A municipality's general fund transmits cash to the debt service fund to finance principal payments on general obligation debt.The debt service fund is not expected to pay the general fund back.How will this transaction be recorded by the general fund and the debt service fund?

General FundDebt Service Fund

a.Increase in current receivablesIncrease in current payables

b.ExpenditureRevenue

c.Other financing useIncrease in current payables

d.Other financing useOther financing source

2.A U.S. company buys inventory from a supplier in Indonesia and pays for the inventory in Indonesian rupiah.The inventory is converted to U.S. dollars on the U.S. company's balance sheet using what $/rupiah exchange rate?

a.The rate when the inventory was paid for

b.The rate at the balance sheet date

c.The rate when the inventory was delivered

d.The rate when the inventory is sold

3.A U.S. company has a forward purchase contract for delivery of euros at the end of May at a price of $1.24/.The U.S. dollar strengthens against the euro during this period.The company will:

a.Gain on the forward purchase contract

b.Loss on the forward purchase contract

c.Not exercise the forward purchase contract

d.Continue to hold the forward contract after the end of May

4.What is the purpose of the fund balance classification system for the general fund?

a.Report on a full accrual basis.

b.Improve evaluation of resource availability.

c.Better measurement of actual costs of providing services.

d.Reduce the tendency to borrow to reduce deficits.