1. Internal Service Funds are accounted for on which basis of accounting?

1. Proprietary cash basis
2. Accrual basis
3. Modified accrual basis
4. Cost basis

2. As a general rule, debt service expenditures are recognized in a Debt Service Fund

1. When financial resources that are be used to make a debt service payment are transferred to a Debt Service Fund
2. In accordance with the legal defeasance provisions in the original bond covenant
3. On the accrual basis if debt service payments are due no more than two months after year-end
4. When the debt service payment is due