PLease assist me with completing this series of take home questions!

David McMahon Answers Due No later than 12:00 P.M. 6/10/12! 1. Under the modified accrual basis of accounting, derived nonexchange revenues are recognized when: Choose one answer. a. they are earned. b. they are measurable and available to finance the expenditures of the current period. c. the underlying exchange transaction occurs. d. the underlying exchange transaction occurs and they are measurable and available to finance the expenditures of the current period. 2. The debt service fund of a governmental entity is accounted for using which of the following bases of accounting? Choose one answer. a. Budgetary basis. b. Cash basis. c. Modified accrual basis. d. Accrual basis. 3. A City issued bonds for the purpose of financing a major capital improvement. Which fund is the most appropriate fund in which to record the receipt of the bond proceeds? Choose one answer. a. General Fund b. Special Revenue Fund c. Capital Projects Fund d. Debt Service Fund. 4. The City of St. Joe had outstanding $5 million of 6% bonds with a call provision. Due to changes in the prevailing interest rates, the City issued new bonds at 4.5% and used the proceeds to call the 6% bonds. This is an example of :Choose one answer. a. Debt retirement. b. Debt refunding. c. In-substance defeasance. d. Economic defeasance. 5. Characteristics of capital projects include: Choose one answer. a. Involves long-lived assets b. Usually requires long-range planning and extensive financing c. Usually has a year-to-year focus d. All of the above e. A & B only 6. General fixed assets are excluded from governmental funds because: Choose one answer. a. The measurement focus of governmental funds is on financial resources b. They are not used to used generate revenues. c. The basis of accounting is accrual. d. None of the above. 7. The City of Shiloh sold a used police car. The police car had a historical cost of $17,000, a fair value of $12,000, and was sold for $5,000. Assuming that the City maintains its books and records in a manner to facilitate the preparation of the fund financial statements, what is the appropriate entry in the General Fund to record this sale? Choose one answer. a. Debit Cash $5,000; Credit Revenue $5,000. b. Debit Cash $5,000 and Loss on Sale $7,000; Credit Automotive Equipment $12,000. c. Debit Cash $5,000; Credit Other Financing SourcesSale of Asset $5,000. d. Debit Cash $5,000; Credit Automotive Equipment $5,000. 8. Which of the following costs will NOT be included in the cost of fixed assets on the government-wide financial statements? Choose one answer a. Purchase price (invoice amount). b. Cost of demolishing existing structures that cannot be used. c. Interest on self-constructed items. d. Engineering costs. 9. Donated assets are reported in the government-wide financial statements as: choose one answer a. Historical cost to the donor. b. Book value in the hands of the donor. c. Fair value on date of donation. d. Zero value because they were not purchased. 10. Which of the following is NOT an infrastructure asset? Choose one answer. a. Roads. b. Sidewalks. c. Buildings. d. Bridges. 11. GASB standards require that depreciation be reported on all capital assets except: Choose one answer. a. Infrastructure accounted for using the standard approach. b. Infrastructure assets accounted for using the modified approach. c. Donated assets. d. Capitalized works of art. 12. Under the modified accrual basis of accounting, imposed nonexchange revenues (such as fines) should be recognized: Choose one answer a. when assessed. b. when the government has an enforceable legal claim. c. when collected. d. when the government has an enforceable legal claim and when the collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period. 13. Under the modified accrual basis of accounting, license fees, permits, and other miscellaneous revenue are generally recognized for practical purposes: Choose one answer. a. when cash is received. b. when the exchange takes place. c. over the period during which the government obtains an enforceable legal claim. d. when related expenditures are incurred. 14. Under GAAP, income tax revenues should be recognized in the governmental fund financial statements in the accounting period: Choose one answer a. when collected in cash by the taxing authority. b. in which the underlying income was earned, regardless of when collected. c. in which the underlying income was earned, if collected in the current period or soon enough thereafter to pay liabilities of the current period. d. when earned. 15. As used in governmental accounting, expenditures are decreases in: Choose one answer. a. Net Assets. b. Net Financial Resources. c. Net Cash. d. Net Economic Resources. 16. Assume that the City of Juneau maintains its books and records to facilitate the preparation of its fund financial statements. The City pays its employees bi-weekly on Friday. The fiscal year ended on Wednesday, June 30. Employees had been paid on Friday, June 25. The employees paid from the General Fund had earned $120,000 on Monday, Tuesday, and Wednesday (June 28, 29, and 30). What entry, if any, should be made in the City's General Fund? Choose one answer. a. Debit Expenditures; Credit Wages and Salaries Payable. b. Debit Expenses; Credit Wages and Salaries Payable. c. Debit Expenditures; Credit Encumbrances. d. No entry is required. 17. Bay City uses the purchases method to account for supplies. At the beginning of the year the City had no supplies on hand. During the year the City purchased $600,000 of supplies for use by activities accounted for in the General Fund. The City used $400,000 of those supplies during the year. Assuming that the city maintains its books and records in a manner that facilitates the preparation of its fund financial statements, at fiscal year-end the appropriate account balances related to supplies expenditures and supplies inventory would be: Choose one answer. a. Expenditures $600,000; Supplies Inventory $200,000. b. Expenditures $600,000; Supplies Inventory $0. c. Expenditures $400,000; Supplies Inventory $200,000. d. Expenditures $400,000; Supplies Inventory $0. 18. The amount of pension expenditures that should be recognized in the government-wide financial statements during the current year is: Choose one answer a. The amount paid. b. The amount paid plus the amount that will be paid with available expendable financial resources. c. The amount paid so long as it does not exceed the actuarially determined amount. d. The actuarially determined amount. 19. In which fund type would a governmental entity's capital projects fund be found? Choose one answer. a. Governmental fund type. b. Proprietary fund type. c. Fiduciary fund type. d. Governmental activities. 20. Six years ago Hill City issued $10 million of 6% term bonds, due 30 years from the date of issue. Interest on the bonds is payable semi-annually on January 1 and July 1. Hill City has a September 30 fiscal year end. The amount of interest payable that would be included on the balance sheet for the debt service fund of Hill City at September 30 would be Choose one answer. a. $ -0-. b. $150,000. c. $300,000. d. $600,000. Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You should not just type your answers into Excel but should actually calculate the answers within the software program where calculations are required. Also have each problem on its own sheet of your Excel document. Then, use the "Save As" function (in the Excel "File" menu) to give this file a name that includes your last name and the assignment number (e.g., "Smith521.doc"). Be sure to save your work frequently on your computer. PROBLEMS 1. Assuming that the City of Katerah maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare all necessary journal entries to record the City's revenues for the year ended 12/31/2007. The city has adopted the 60-day rule for all revenue recognition for which it is appropriate. a.) On January 15, the City received notification that it was the recipient of a $200,000 federal grant to assist in the operation of its \"Meals on Wheels' program. The federal government expects to send the cash in about 3 months. This is not a reimbursement type grant, and all eligibility requirements have been met. ANSWER: b.) In February the City spent $21,000 on \"Meals on Wheels.\" ANSWER: c.) In March, fines of $1,200 were issued for parking tickets. Payment must be made within 30 days, when the City has an enforceable legal claim to the amounts. ANSWER: d.) In April, the City received the $200,000 from the federal government. ANSWER: e.) Payments of $800 were received in April in payment of March parking tickets. $100 in tickets were contested and court dates have been set. The City expects that $100 in tickets will be uncollectible and the remaining amounts will be paid eventually. ANSWER: f.) Restaurant licenses are issued for a one-year period. The licenses are valid for one year from July 1 to June 30. The license fees are used to pay restaurant inspectors. In June, $7,500 in restaurant license fees was received. ANSWER: 2. During the year the City of Hamburg engaged in the following transactions. The City uses the consumption method of recording inventories and prepayments. The City has a 6/30 fiscal year end. REQUIRED: Record the following transactions related to supplies, prepaid items and fixed asset acquisitions. Be sure to make ALL necessary entries. During the year the City purchases $600,000 of expendable supplies. ANSWER: On September 1 the City paid $360,000 for a three-year insurance policy to cover some assets used in general government activities. ANSWER: On December 1 the City purchased four pickup trucks for general government activities. The trucks cost $100,000 in total. ANSWER: On January 1 the City leased some office equipment for use in the administrative offices. The lease qualified as a capital lease. The present value of the minimum lease payments is $96,000. ANSWER: On April 1 the City leased a copying machine. The lease qualified as an operating lease. The terms of the lease require yearly payments of $2,000 each April 1 for 5 years. The City prepaid the entire five years of the lease. ANSWER: 3. The voters of Salt Lake City authorized the construction of a new north-south expressway for a total cost of no more that $75 million. The voters also approved the issuance of $50 million of 5% general obligation bonds. The balance of the necessary funds will come from the following sources: $15 million from a federal grant and $10 million from a state grant. The City controls expenditures in capital project funds through project management. The City does not formally incorporate budgetary entries in the capital projects fund but it does use encumbrance accounting for control purposes. REQUIRED: Assuming the City maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare journal entries, in the Capital Projects Fund, for the following transactions. The City issued $50 million of 5% general obligation bonds at 101. ANSWER: The City transferred the premium to the appropriate fund. ANSWER: The City incurred bid-related expenditures of $1,000. ANSWER: The City signed a contract with the lowest competent bidder for $48 million. ANSWER: (e) The city received notice from the State that the grant had been approved and the proceeds will be forwarded to the City in the State's current fiscal year. ANSWER: The City received the federal grant in full. ANSWER: The City received a progress billing from the contractor for $10 million. The City pays the billing. ANSWER: 4. The City of Brownsville engaged in the following transactions. REQUIRED: Assuming that the City maintains its books and records in a manner that facilitates the preparation of fund financial statements, prepare the appropriate journal entries in the General Fund. If no entry is required, write \"No Entry Required.\" a) The City purchased for cash three dump trucks at a unit cost of $70,000 each. ANSWER: b) The City sold for $3,000, a police car that had been purchased four years ago at a cost of $30,000. At the time of acquisition, the City estimated that the police car had a useful life of five years and a salvage value of $5,000. ANSWER: c) During the year, the City spent $12 million to build a third lane on both sides of the major north-south highway through town. ANSWER: d) The City traded in a pickup truck used in general government operations for a new pickup truck, paying a difference of $16,000. The old pickup truck was purchased four years ago at a cost of $21,000. At the time it had an estimated useful life of five years, and an estimated salvage value of $6,000. At the time of the trade, the old truck had a fair value of $10,000. The new truck has a sticker price of $27,000. ANSWER: e) During the year the City began construction of a new City Hall. By year-end, the City had made progress payments to the contractor of $2 million. ANSWER: f) The City received a gift of land from a citizen. The land is to be used to build a city park. The land had been in Mrs. Marshall's family since it was homesteaded. It had a fair value when contributed of $2 million. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You sh answers into Excel but should actually calculate the answers within the software program where calculations are PROBLEMS 2. During the year the City of Hamburg engaged in the following transactions. The City uses the consum recording inventories and prepayments. The City has a 6/30 fiscal year end. REQUIRED: Record the fol related During the year the City purchases $600,000 of expendable supplies. ANSWER: On September 1 the City paid $360,000 for a three-year insurance policy to cover some assets used in general g ANSWER: On December 1 the City purchased four pickup trucks for general government activities. The trucks cost $100,00 ANSWER: On January 1 the City leased some office equipment for use in the administrative offices. The lease qualified as present value of the minimum lease payments is $96,000. ANSWER: On April 1 the City leased a copying machine. The lease qualified as an operating lease. The terms of the lease of $2,000 each April 1 for 5 years. The City prepaid the entire five years of the lease. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You should not just type your answers into Excel but should actually calculate the answers within the software program where calculations are required. Also have each problem on its own sheet of your Excel document. Then, use the "Save As" function (in the Excel "File" menu) to give this file a name that includes your last name and the assignment number (e.g., "Smith521.doc"). Be sure to save your work frequently on your computer. PROBLEMS 3. The voters of Salt Lake City authorized the construction of a new north-south expressway for a total cost of no more that $75 million. The voters also approved the issuance of $50 million of 5% general obligation bonds. The balance of the necessary funds will come from the following sources: $15 million from a federal grant and $10 million from a state grant. The City controls expenditures in capital project funds through project management. The City does not formally incorporate budgetary entries in the capital projects fund but it does use encumbrance accounting for control purposes. REQUIRED: Assuming the City maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare journal entries, in the Capital Projects Fund, for the following transactions. The City issued $50 million of 5% general obligation bonds at 101. ANSWER: The City transferred the premium to the appropriate fund. ANSWER: The City incurred bid-related expenditures of $1,000. ANSWER: The City signed a contract with the lowest competent bidder for $48 million. ANSWER: (e) The city received notice from the State that the grant had been approved and the proceeds will be forwarded to the City in the State's current fiscal year. ANSWER: The City received the federal grant in full. ANSWER: The City received a progress billing from the contractor for $10 million. The City pays the billing. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You sh answers into Excel but should actually calculate the answers within the software program where calculations are PROBLEMS 4. The City of Brownsville engaged in the following transactions. REQUIRED: Assuming that the City m records in a manner that facilitates the preparation of fund financial statements, prepare the appropriate j a) The City purchased for cash three dump trucks at a unit cost of $70,000 each. ANSWER: b) The City sold for $3,000, a police car that had been purchased four years ago at a cost of $30,000. At the City estimated that the police car had a useful life of five years and a salvage value of $5,000. ANSWER: c) During the year, the City spent $12 million to build a third lane on both sides of the major north-south ANSWER: d) The City traded in a pickup truck used in general government operations for a new pickup truck, payin $16,000. The old pickup truck was purchased four years ago at a cost of $21,000. At the time it had an es ANSWER: e) During the year the City began construction of a new City Hall. By year-end, the City had made progre contractor of $2 million. ANSWER: f) The City received a gift of land from a citizen. The land is to be used to build a city park. The land ha Marshall's family since it was homesteaded. It had a fair value when contributed of $2 million. ANSWER: David McMahon Answers Due No later than 12:00 P.M. 6/10/12! 1. Under the modified accrual basis of accounting, derived nonexchange revenues are recognized when: Choose one answer. a. they are earned. b. they are measurable and available to finance the expenditures of the current period. c. the underlying exchange transaction occurs. d. the underlying exchange transaction occurs and they are measurable and available to finance the expenditures of the current period. 2. The debt service fund of a governmental entity is accounted for using which of the following bases of accounting? Choose one answer. a. Budgetary basis. b. Cash basis. c. Modified accrual basis. d. Accrual basis. 3. A City issued bonds for the purpose of financing a major capital improvement. Which fund is the most appropriate fund in which to record the receipt of the bond proceeds? Choose one answer. a. General Fund b. Special Revenue Fund c. Capital Projects Fund d. Debt Service Fund. 4. The City of St. Joe had outstanding $5 million of 6% bonds with a call provision. Due to changes in the prevailing interest rates, the City issued new bonds at 4.5% and used the proceeds to call the 6% bonds. This is an example of :Choose one answer. a. Debt retirement. b. Debt refunding. c. In-substance defeasance. d. Economic defeasance. 5. Characteristics of capital projects include: Choose one answer. a. Involves long-lived assets b. Usually requires long-range planning and extensive financing c. Usually has a year-to-year focus d. All of the above e. A & B only 6. General fixed assets are excluded from governmental funds because: Choose one answer. a. The measurement focus of governmental funds is on financial resources b. They are not used to used generate revenues. c. The basis of accounting is accrual. d. None of the above. 7. The City of Shiloh sold a used police car. The police car had a historical cost of $17,000, a fair value of $12,000, and was sold for $5,000. Assuming that the City maintains its books and records in a manner to facilitate the preparation of the fund financial statements, what is the appropriate entry in the General Fund to record this sale? Choose one answer. a. Debit Cash $5,000; Credit Revenue $5,000. b. Debit Cash $5,000 and Loss on Sale $7,000; Credit Automotive Equipment $12,000. c. Debit Cash $5,000; Credit Other Financing SourcesSale of Asset $5,000. d. Debit Cash $5,000; Credit Automotive Equipment $5,000. 8. Which of the following costs will NOT be included in the cost of fixed assets on the government-wide financial statements? Choose one answer a. Purchase price (invoice amount). b. Cost of demolishing existing structures that cannot be used. c. Interest on self-constructed items. d. Engineering costs. 9. Donated assets are reported in the government-wide financial statements as: choose one answer a. Historical cost to the donor. b. Book value in the hands of the donor. c. Fair value on date of donation. d. Zero value because they were not purchased. 10. Which of the following is NOT an infrastructure asset? Choose one answer. a. Roads. b. Sidewalks. c. Buildings. d. Bridges. 11. GASB standards require that depreciation be reported on all capital assets except: Choose one answer. a. Infrastructure accounted for using the standard approach. b. Infrastructure assets accounted for using the modified approach. c. Donated assets. d. Capitalized works of art. 12. Under the modified accrual basis of accounting, imposed nonexchange revenues (such as fines) should be recognized: Choose one answer a. when assessed. b. when the government has an enforceable legal claim. c. when collected. d. when the government has an enforceable legal claim and when the collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period. 13. Under the modified accrual basis of accounting, license fees, permits, and other miscellaneous revenue are generally recognized for practical purposes: Choose one answer. a. when cash is received. b. when the exchange takes place. c. over the period during which the government obtains an enforceable legal claim. d. when related expenditures are incurred. 14. Under GAAP, income tax revenues should be recognized in the governmental fund financial statements in the accounting period: Choose one answer a. when collected in cash by the taxing authority. b. in which the underlying income was earned, regardless of when collected. c. in which the underlying income was earned, if collected in the current period or soon enough thereafter to pay liabilities of the current period. d. when earned. 15. As used in governmental accounting, expenditures are decreases in: Choose one answer. a. Net Assets. b. Net Financial Resources. c. Net Cash. d. Net Economic Resources. 16. Assume that the City of Juneau maintains its books and records to facilitate the preparation of its fund financial statements. The City pays its employees bi-weekly on Friday. The fiscal year ended on Wednesday, June 30. Employees had been paid on Friday, June 25. The employees paid from the General Fund had earned $120,000 on Monday, Tuesday, and Wednesday (June 28, 29, and 30). What entry, if any, should be made in the City's General Fund? Choose one answer. a. Debit Expenditures; Credit Wages and Salaries Payable. b. Debit Expenses; Credit Wages and Salaries Payable. c. Debit Expenditures; Credit Encumbrances. d. No entry is required. 17. Bay City uses the purchases method to account for supplies. At the beginning of the year the City had no supplies on hand. During the year the City purchased $600,000 of supplies for use by activities accounted for in the General Fund. The City used $400,000 of those supplies during the year. Assuming that the city maintains its books and records in a manner that facilitates the preparation of its fund financial statements, at fiscal year-end the appropriate account balances related to supplies expenditures and supplies inventory would be: Choose one answer. a. Expenditures $600,000; Supplies Inventory $200,000. b. Expenditures $600,000; Supplies Inventory $0. c. Expenditures $400,000; Supplies Inventory $200,000. d. Expenditures $400,000; Supplies Inventory $0. 18. The amount of pension expenditures that should be recognized in the government-wide financial statements during the current year is: Choose one answer a. The amount paid. b. The amount paid plus the amount that will be paid with available expendable financial resources. c. The amount paid so long as it does not exceed the actuarially determined amount. d. The actuarially determined amount. 19. In which fund type would a governmental entity's capital projects fund be found? Choose one answer. a. Governmental fund type. b. Proprietary fund type. c. Fiduciary fund type. d. Governmental activities. 20. Six years ago Hill City issued $10 million of 6% term bonds, due 30 years from the date of issue. Interest on the bonds is payable semi-annually on January 1 and July 1. Hill City has a September 30 fiscal year end. The amount of interest payable that would be included on the balance sheet for the debt service fund of Hill City at September 30 would be Choose one answer. a. $ -0-. b. $150,000. c. $300,000. d. $600,000. David McMahon Answers Due No later than 12:00 P.M. 6/10/12! 1. Under the modified accrual basis of accounting, derived nonexchange revenues are recognized when: Choose one answer. a. they are earned. b. they are measurable and available to finance the expenditures of the current period. c. the underlying exchange transaction occurs. d. the underlying exchange transaction occurs and they are measurable and available to finance the expenditures of the current period. 2. The debt service fund of a governmental entity is accounted for using which of the following bases of accounting? Choose one answer. a. Budgetary basis. b. Cash basis. c. Modified accrual basis. d. Accrual basis. 3. A City issued bonds for the purpose of financing a major capital improvement. Which fund is the most appropriate fund in which to record the receipt of the bond proceeds? Choose one answer. a. General Fund b. Special Revenue Fund c. Capital Projects Fund d. Debt Service Fund. 4. The City of St. Joe had outstanding $5 million of 6% bonds with a call provision. Due to changes in the prevailing interest rates, the City issued new bonds at 4.5% and used the proceeds to call the 6% bonds. This is an example of :Choose one answer. a. Debt retirement. b. Debt refunding. c. In-substance defeasance. d. Economic defeasance. 5. Characteristics of capital projects include: Choose one answer. a. Involves long-lived assets b. Usually requires long-range planning and extensive financing c. Usually has a year-to-year focus d. All of the above e. A & B only 6. General fixed assets are excluded from governmental funds because: Choose one answer. a. The measurement focus of governmental funds is on financial resources b. They are not used to used generate revenues. c. The basis of accounting is accrual. d. None of the above. 7. The City of Shiloh sold a used police car. The police car had a historical cost of $17,000, a fair value of $12,000, and was sold for $5,000. Assuming that the City maintains its books and records in a manner to facilitate the preparation of the fund financial statements, what is the appropriate entry in the General Fund to record this sale? Choose one answer. a. Debit Cash $5,000; Credit Revenue $5,000. b. Debit Cash $5,000 and Loss on Sale $7,000; Credit Automotive Equipment $12,000. c. Debit Cash $5,000; Credit Other Financing SourcesSale of Asset $5,000. d. Debit Cash $5,000; Credit Automotive Equipment $5,000. 8. Which of the following costs will NOT be included in the cost of fixed assets on the government-wide financial statements? Choose one answer a. Purchase price (invoice amount). b. Cost of demolishing existing structures that cannot be used. c. Interest on self-constructed items. d. Engineering costs. 9. Donated assets are reported in the government-wide financial statements as: choose one answer a. Historical cost to the donor. b. Book value in the hands of the donor. c. Fair value on date of donation. d. Zero value because they were not purchased. 10. Which of the following is NOT an infrastructure asset? Choose one answer. a. Roads. b. Sidewalks. c. Buildings. d. Bridges. 11. GASB standards require that depreciation be reported on all capital assets except: Choose one answer. a. Infrastructure accounted for using the standard approach. b. Infrastructure assets accounted for using the modified approach. c. Donated assets. d. Capitalized works of art. 12. Under the modified accrual basis of accounting, imposed nonexchange revenues (such as fines) should be recognized: Choose one answer a. when assessed. b. when the government has an enforceable legal claim. c. when collected. d. when the government has an enforceable legal claim and when the collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period. 13. Under the modified accrual basis of accounting, license fees, permits, and other miscellaneous revenue are generally recognized for practical purposes: Choose one answer. a. when cash is received. b. when the exchange takes place. c. over the period during which the government obtains an enforceable legal claim. d. when related expenditures are incurred. 14. Under GAAP, income tax revenues should be recognized in the governmental fund financial statements in the accounting period: Choose one answer a. when collected in cash by the taxing authority. b. in which the underlying income was earned, regardless of when collected. c. in which the underlying income was earned, if collected in the current period or soon enough thereafter to pay liabilities of the current period. d. when earned. 15. As used in governmental accounting, expenditures are decreases in: Choose one answer. a. Net Assets. b. Net Financial Resources. c. Net Cash. d. Net Economic Resources. 16. Assume that the City of Juneau maintains its books and records to facilitate the preparation of its fund financial statements. The City pays its employees bi-weekly on Friday. The fiscal year ended on Wednesday, June 30. Employees had been paid on Friday, June 25. The employees paid from the General Fund had earned $120,000 on Monday, Tuesday, and Wednesday (June 28, 29, and 30). What entry, if any, should be made in the City's General Fund? Choose one answer. a. Debit Expenditures; Credit Wages and Salaries Payable. b. Debit Expenses; Credit Wages and Salaries Payable. c. Debit Expenditures; Credit Encumbrances. d. No entry is required. 17. Bay City uses the purchases method to account for supplies. At the beginning of the year the City had no supplies on hand. During the year the City purchased $600,000 of supplies for use by activities accounted for in the General Fund. The City used $400,000 of those supplies during the year. Assuming that the city maintains its books and records in a manner that facilitates the preparation of its fund financial statements, at fiscal year-end the appropriate account balances related to supplies expenditures and supplies inventory would be: Choose one answer. a. Expenditures $600,000; Supplies Inventory $200,000. b. Expenditures $600,000; Supplies Inventory $0. c. Expenditures $400,000; Supplies Inventory $200,000. d. Expenditures $400,000; Supplies Inventory $0. 18. The amount of pension expenditures that should be recognized in the government-wide financial statements during the current year is: Choose one answer a. The amount paid. b. The amount paid plus the amount that will be paid with available expendable financial resources. c. The amount paid so long as it does not exceed the actuarially determined amount. d. The actuarially determined amount. 19. In which fund type would a governmental entity's capital projects fund be found? Choose one answer. a. Governmental fund type. b. Proprietary fund type. c. Fiduciary fund type. d. Governmental activities. 20. Six years ago Hill City issued $10 million of 6% term bonds, due 30 years from the date of issue. Interest on the bonds is payable semi-annually on January 1 and July 1. Hill City has a September 30 fiscal year end. The amount of interest payable that would be included on the balance sheet for the debt service fund of Hill City at September 30 would be Choose one answer. a. $ -0-. b. $150,000. c. $300,000. d. $600,000. David McMahon Answers Due No later than 12:00 P.M. 6/10/12! 1. Under the modified accrual basis of accounting, derived nonexchange revenues are recognized when: Choose one answer. a. they are earned. b. they are measurable and available to finance the expenditures of the current period. c. the underlying exchange transaction occurs. d. the underlying exchange transaction occurs and they are measurable and available to finance the expenditures of the current period. 2. The debt service fund of a governmental entity is accounted for using which of the following bases of accounting? Choose one answer. a. Budgetary basis. b. Cash basis. c. Modified accrual basis. d. Accrual basis. 3. A City issued bonds for the purpose of financing a major capital improvement. Which fund is the most appropriate fund in which to record the receipt of the bond proceeds? Choose one answer. a. General Fund b. Special Revenue Fund c. Capital Projects Fund d. Debt Service Fund. 4. The City of St. Joe had outstanding $5 million of 6% bonds with a call provision. Due to changes in the prevailing interest rates, the City issued new bonds at 4.5% and used the proceeds to call the 6% bonds. This is an example of :Choose one answer. a. Debt retirement. b. Debt refunding. c. In-substance defeasance. d. Economic defeasance. 5. Characteristics of capital projects include: Choose one answer. a. Involves long-lived assets b. Usually requires long-range planning and extensive financing c. Usually has a year-to-year focus d. All of the above e. A & B only 6. General fixed assets are excluded from governmental funds because: Choose one answer. a. The measurement focus of governmental funds is on financial resources b. They are not used to used generate revenues. c. The basis of accounting is accrual. d. None of the above. 7. The City of Shiloh sold a used police car. The police car had a historical cost of $17,000, a fair value of $12,000, and was sold for $5,000. Assuming that the City maintains its books and records in a manner to facilitate the preparation of the fund financial statements, what is the appropriate entry in the General Fund to record this sale? Choose one answer. a. Debit Cash $5,000; Credit Revenue $5,000. b. Debit Cash $5,000 and Loss on Sale $7,000; Credit Automotive Equipment $12,000. c. Debit Cash $5,000; Credit Other Financing SourcesSale of Asset $5,000. d. Debit Cash $5,000; Credit Automotive Equipment $5,000. 8. Which of the following costs will NOT be included in the cost of fixed assets on the government-wide financial statements? Choose one answer a. Purchase price (invoice amount). b. Cost of demolishing existing structures that cannot be used. c. Interest on self-constructed items. d. Engineering costs. 9. Donated assets are reported in the government-wide financial statements as: choose one answer a. Historical cost to the donor. b. Book value in the hands of the donor. c. Fair value on date of donation. d. Zero value because they were not purchased. 10. Which of the following is NOT an infrastructure asset? Choose one answer. a. Roads. b. Sidewalks. c. Buildings. d. Bridges. 11. GASB standards require that depreciation be reported on all capital assets except: Choose one answer. a. Infrastructure accounted for using the standard approach. b. Infrastructure assets accounted for using the modified approach. c. Donated assets. d. Capitalized works of art. 12. Under the modified accrual basis of accounting, imposed nonexchange revenues (such as fines) should be recognized: Choose one answer a. when assessed. b. when the government has an enforceable legal claim. c. when collected. d. when the government has an enforceable legal claim and when the collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period. 13. Under the modified accrual basis of accounting, license fees, permits, and other miscellaneous revenue are generally recognized for practical purposes: Choose one answer. a. when cash is received. b. when the exchange takes place. c. over the period during which the government obtains an enforceable legal claim. d. when related expenditures are incurred. 14. Under GAAP, income tax revenues should be recognized in the governmental fund financial statements in the accounting period: Choose one answer a. when collected in cash by the taxing authority. b. in which the underlying income was earned, regardless of when collected. c. in which the underlying income was earned, if collected in the current period or soon enough thereafter to pay liabilities of the current period. d. when earned. 15. As used in governmental accounting, expenditures are decreases in: Choose one answer. a. Net Assets. b. Net Financial Resources. c. Net Cash. d. Net Economic Resources. 16. Assume that the City of Juneau maintains its books and records to facilitate the preparation of its fund financial statements. The City pays its employees bi-weekly on Friday. The fiscal year ended on Wednesday, June 30. Employees had been paid on Friday, June 25. The employees paid from the General Fund had earned $120,000 on Monday, Tuesday, and Wednesday (June 28, 29, and 30). What entry, if any, should be made in the City's General Fund? Choose one answer. a. Debit Expenditures; Credit Wages and Salaries Payable. b. Debit Expenses; Credit Wages and Salaries Payable. c. Debit Expenditures; Credit Encumbrances. d. No entry is required. 17. Bay City uses the purchases method to account for supplies. At the beginning of the year the City had no supplies on hand. During the year the City purchased $600,000 of supplies for use by activities accounted for in the General Fund. The City used $400,000 of those supplies during the year. Assuming that the city maintains its books and records in a manner that facilitates the preparation of its fund financial statements, at fiscal year-end the appropriate account balances related to supplies expenditures and supplies inventory would be: Choose one answer. a. Expenditures $600,000; Supplies Inventory $200,000. b. Expenditures $600,000; Supplies Inventory $0. c. Expenditures $400,000; Supplies Inventory $200,000. d. Expenditures $400,000; Supplies Inventory $0. 18. The amount of pension expenditures that should be recognized in the government-wide financial statements during the current year is: Choose one answer a. The amount paid. b. The amount paid plus the amount that will be paid with available expendable financial resources. c. The amount paid so long as it does not exceed the actuarially determined amount. d. The actuarially determined amount. 19. In which fund type would a governmental entity's capital projects fund be found? Choose one answer. a. Governmental fund type. b. Proprietary fund type. c. Fiduciary fund type. d. Governmental activities. 20. Six years ago Hill City issued $10 million of 6% term bonds, due 30 years from the date of issue. Interest on the bonds is payable semi-annually on January 1 and July 1. Hill City has a September 30 fiscal year end. The amount of interest payable that would be included on the balance sheet for the debt service fund of Hill City at September 30 would be Choose one answer. a. $ -0-. b. $150,000. c. $300,000. d. $600,000. Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You should not just type your answers into Excel but should actually calculate the answers within the software program where calculations are required. Also have each problem on its own sheet of your Excel document. Then, use the "Save As" function (in the Excel "File" menu) to give this file a name that includes your last name and the assignment number (e.g., "Smith521.doc"). Be sure to save your work frequently on your computer. PROBLEMS 1. Assuming that the City of Katerah maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare all necessary journal entries to record the City's revenues for the year ended 12/31/2007. The city has adopted the 60-day rule for all revenue recognition for which it is appropriate. a.) On January 15, the City received notification that it was the recipient of a $200,000 federal grant to assist in the operation of its \"Meals on Wheels' program. The federal government expects to send the cash in about 3 months. This is not a reimbursement type grant, and all eligibility requirements have been met. ANSWER: b.) In February the City spent $21,000 on \"Meals on Wheels.\" ANSWER: c.) In March, fines of $1,200 were issued for parking tickets. Payment must be made within 30 days, when the City has an enforceable legal claim to the amounts. ANSWER: d.) In April, the City received the $200,000 from the federal government. ANSWER: e.) Payments of $800 were received in April in payment of March parking tickets. $100 in tickets were contested and court dates have been set. The City expects that $100 in tickets will be uncollectible and the remaining amounts will be paid eventually. ANSWER: f.) Restaurant licenses are issued for a one-year period. The licenses are valid for one year from July 1 to June 30. The license fees are used to pay restaurant inspectors. In June, $7,500 in restaurant license fees was received. ANSWER: 2. During the year the City of Hamburg engaged in the following transactions. The City uses the consumption method of recording inventories and prepayments. The City has a 6/30 fiscal year end. REQUIRED: Record the following transactions related to supplies, prepaid items and fixed asset acquisitions. Be sure to make ALL necessary entries. During the year the City purchases $600,000 of expendable supplies. ANSWER: On September 1 the City paid $360,000 for a three-year insurance policy to cover some assets used in general government activities. ANSWER: On December 1 the City purchased four pickup trucks for general government activities. The trucks cost $100,000 in total. ANSWER: On January 1 the City leased some office equipment for use in the administrative offices. The lease qualified as a capital lease. The present value of the minimum lease payments is $96,000. ANSWER: On April 1 the City leased a copying machine. The lease qualified as an operating lease. The terms of the lease require yearly payments of $2,000 each April 1 for 5 years. The City prepaid the entire five years of the lease. ANSWER: 3. The voters of Salt Lake City authorized the construction of a new north-south expressway for a total cost of no more that $75 million. The voters also approved the issuance of $50 million of 5% general obligation bonds. The balance of the necessary funds will come from the following sources: $15 million from a federal grant and $10 million from a state grant. The City controls expenditures in capital project funds through project management. The City does not formally incorporate budgetary entries in the capital projects fund but it does use encumbrance accounting for control purposes. REQUIRED: Assuming the City maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare journal entries, in the Capital Projects Fund, for the following transactions. The City issued $50 million of 5% general obligation bonds at 101. ANSWER: The City transferred the premium to the appropriate fund. ANSWER: The City incurred bid-related expenditures of $1,000. ANSWER: The City signed a contract with the lowest competent bidder for $48 million. ANSWER: (e) The city received notice from the State that the grant had been approved and the proceeds will be forwarded to the City in the State's current fiscal year. ANSWER: The City received the federal grant in full. ANSWER: The City received a progress billing from the contractor for $10 million. The City pays the billing. ANSWER: 4. The City of Brownsville engaged in the following transactions. REQUIRED: Assuming that the City maintains its books and records in a manner that facilitates the preparation of fund financial statements, prepare the appropriate journal entries in the General Fund. If no entry is required, write \"No Entry Required.\" a) The City purchased for cash three dump trucks at a unit cost of $70,000 each. ANSWER: b) The City sold for $3,000, a police car that had been purchased four years ago at a cost of $30,000. At the time of acquisition, the City estimated that the police car had a useful life of five years and a salvage value of $5,000. ANSWER: c) During the year, the City spent $12 million to build a third lane on both sides of the major north-south highway through town. ANSWER: d) The City traded in a pickup truck used in general government operations for a new pickup truck, paying a difference of $16,000. The old pickup truck was purchased four years ago at a cost of $21,000. At the time it had an estimated useful life of five years, and an estimated salvage value of $6,000. At the time of the trade, the old truck had a fair value of $10,000. The new truck has a sticker price of $27,000. ANSWER: e) During the year the City began construction of a new City Hall. By year-end, the City had made progress payments to the contractor of $2 million. ANSWER: f) The City received a gift of land from a citizen. The land is to be used to build a city park. The land had been in Mrs. Marshall's family since it was homesteaded. It had a fair value when contributed of $2 million. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You sh answers into Excel but should actually calculate the answers within the software program where calculations are PROBLEMS 2. During the year the City of Hamburg engaged in the following transactions. The City uses the consum recording inventories and prepayments. The City has a 6/30 fiscal year end. REQUIRED: Record the fol related During the year the City purchases $600,000 of expendable supplies. ANSWER: On September 1 the City paid $360,000 for a three-year insurance policy to cover some assets used in general g ANSWER: On December 1 the City purchased four pickup trucks for general government activities. The trucks cost $100,00 ANSWER: On January 1 the City leased some office equipment for use in the administrative offices. The lease qualified as present value of the minimum lease payments is $96,000. ANSWER: On April 1 the City leased a copying machine. The lease qualified as an operating lease. The terms of the lease of $2,000 each April 1 for 5 years. The City prepaid the entire five years of the lease. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You should not just type your answers into Excel but should actually calculate the answers within the software program where calculations are required. Also have each problem on its own sheet of your Excel document. Then, use the "Save As" function (in the Excel "File" menu) to give this file a name that includes your last name and the assignment number (e.g., "Smith521.doc"). Be sure to save your work frequently on your computer. PROBLEMS 3. The voters of Salt Lake City authorized the construction of a new north-south expressway for a total cost of no more that $75 million. The voters also approved the issuance of $50 million of 5% general obligation bonds. The balance of the necessary funds will come from the following sources: $15 million from a federal grant and $10 million from a state grant. The City controls expenditures in capital project funds through project management. The City does not formally incorporate budgetary entries in the capital projects fund but it does use encumbrance accounting for control purposes. REQUIRED: Assuming the City maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare journal entries, in the Capital Projects Fund, for the following transactions. The City issued $50 million of 5% general obligation bonds at 101. ANSWER: The City transferred the premium to the appropriate fund. ANSWER: The City incurred bid-related expenditures of $1,000. ANSWER: The City signed a contract with the lowest competent bidder for $48 million. ANSWER: (e) The city received notice from the State that the grant had been approved and the proceeds will be forwarded to the City in the State's current fiscal year. ANSWER: The City received the federal grant in full. ANSWER: The City received a progress billing from the contractor for $10 million. The City pays the billing. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You sh answers into Excel but should actually calculate the answers within the software program where calculations are PROBLEMS 4. The City of Brownsville engaged in the following transactions. REQUIRED: Assuming that the City m records in a manner that facilitates the preparation of fund financial statements, prepare the appropriate j a) The City purchased for cash three dump trucks at a unit cost of $70,000 each. ANSWER: b) The City sold for $3,000, a police car that had been purchased four years ago at a cost of $30,000. At the City estimated that the police car had a useful life of five years and a salvage value of $5,000. ANSWER: c) During the year, the City spent $12 million to build a third lane on both sides of the major north-south ANSWER: d) The City traded in a pickup truck used in general government operations for a new pickup truck, payin $16,000. The old pickup truck was purchased four years ago at a cost of $21,000. At the time it had an es ANSWER: e) During the year the City began construction of a new City Hall. By year-end, the City had made progre contractor of $2 million. ANSWER: f) The City received a gift of land from a citizen. The land is to be used to build a city park. The land ha Marshall's family since it was homesteaded. It had a fair value when contributed of $2 million. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You should not just type your answers into Excel but should actually calculate the answers within the software program where calculations are required. Also have each problem on its own sheet of your Excel document. Then, use the "Save As" function (in the Excel "File" menu) to give this file a name that includes your last name and the assignment number (e.g., "Smith521.doc"). Be sure to save your work frequently on your computer. PROBLEMS 1. Assuming that the City of Katerah maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare all necessary journal entries to record the City's revenues for the year ended 12/31/2007. The city has adopted the 60-day rule for all revenue recognition for which it is appropriate. a.) On January 15, the City received notification that it was the recipient of a $200,000 federal grant to assist in the operation of its \"Meals on Wheels' program. The federal government expects to send the cash in about 3 months. This is not a reimbursement type grant, and all eligibility requirements have been met. ANSWER: b.) In February the City spent $21,000 on \"Meals on Wheels.\" ANSWER: c.) In March, fines of $1,200 were issued for parking tickets. Payment must be made within 30 days, when the City has an enforceable legal claim to the amounts. ANSWER: d.) In April, the City received the $200,000 from the federal government. ANSWER: e.) Payments of $800 were received in April in payment of March parking tickets. $100 in tickets were contested and court dates have been set. The City expects that $100 in tickets will be uncollectible and the remaining amounts will be paid eventually. ANSWER: f.) Restaurant licenses are issued for a one-year period. The licenses are valid for one year from July 1 to June 30. The license fees are used to pay restaurant inspectors. In June, $7,500 in restaurant license fees was received. ANSWER: 2. During the year the City of Hamburg engaged in the following transactions. The City uses the consumption method of recording inventories and prepayments. The City has a 6/30 fiscal year end. REQUIRED: Record the following transactions related to supplies, prepaid items and fixed asset acquisitions. Be sure to make ALL necessary entries. During the year the City purchases $600,000 of expendable supplies. ANSWER: On September 1 the City paid $360,000 for a three-year insurance policy to cover some assets used in general government activities. ANSWER: On December 1 the City purchased four pickup trucks for general government activities. The trucks cost $100,000 in total. ANSWER: On January 1 the City leased some office equipment for use in the administrative offices. The lease qualified as a capital lease. The present value of the minimum lease payments is $96,000. ANSWER: On April 1 the City leased a copying machine. The lease qualified as an operating lease. The terms of the lease require yearly payments of $2,000 each April 1 for 5 years. The City prepaid the entire five years of the lease. ANSWER: 3. The voters of Salt Lake City authorized the construction of a new north-south expressway for a total cost of no more that $75 million. The voters also approved the issuance of $50 million of 5% general obligation bonds. The balance of the necessary funds will come from the following sources: $15 million from a federal grant and $10 million from a state grant. The City controls expenditures in capital project funds through project management. The City does not formally incorporate budgetary entries in the capital projects fund but it does use encumbrance accounting for control purposes. REQUIRED: Assuming the City maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare journal entries, in the Capital Projects Fund, for the following transactions. The City issued $50 million of 5% general obligation bonds at 101. ANSWER: The City transferred the premium to the appropriate fund. ANSWER: The City incurred bid-related expenditures of $1,000. ANSWER: The City signed a contract with the lowest competent bidder for $48 million. ANSWER: (e) The city received notice from the State that the grant had been approved and the proceeds will be forwarded to the City in the State's current fiscal year. ANSWER: The City received the federal grant in full. ANSWER: The City received a progress billing from the contractor for $10 million. The City pays the billing. ANSWER: 4. The City of Brownsville engaged in the following transactions. REQUIRED: Assuming that the City maintains its books and records in a manner that facilitates the preparation of fund financial statements, prepare the appropriate journal entries in the General Fund. If no entry is required, write \"No Entry Required.\" a) The City purchased for cash three dump trucks at a unit cost of $70,000 each. ANSWER: b) The City sold for $3,000, a police car that had been purchased four years ago at a cost of $30,000. At the time of acquisition, the City estimated that the police car had a useful life of five years and a salvage value of $5,000. ANSWER: c) During the year, the City spent $12 million to build a third lane on both sides of the major north-south highway through town. ANSWER: d) The City traded in a pickup truck used in general government operations for a new pickup truck, paying a difference of $16,000. The old pickup truck was purchased four years ago at a cost of $21,000. At the time it had an estimated useful life of five years, and an estimated salvage value of $6,000. At the time of the trade, the old truck had a fair value of $10,000. The new truck has a sticker price of $27,000. ANSWER: e) During the year the City began construction of a new City Hall. By year-end, the City had made progress payments to the contractor of $2 million. ANSWER: f) The City received a gift of land from a citizen. The land is to be used to build a city park. The land had been in Mrs. Marshall's family since it was homesteaded. It had a fair value when contributed of $2 million. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You sh answers into Excel but should actually calculate the answers within the software program where calculations are PROBLEMS 2. During the year the City of Hamburg engaged in the following transactions. The City uses the consum recording inventories and prepayments. The City has a 6/30 fiscal year end. REQUIRED: Record the fol related During the year the City purchases $600,000 of expendable supplies. ANSWER: On September 1 the City paid $360,000 for a three-year insurance policy to cover some assets used in general g ANSWER: On December 1 the City purchased four pickup trucks for general government activities. The trucks cost $100,00 ANSWER: On January 1 the City leased some office equipment for use in the administrative offices. The lease qualified as present value of the minimum lease payments is $96,000. ANSWER: On April 1 the City leased a copying machine. The lease qualified as an operating lease. The terms of the lease of $2,000 each April 1 for 5 years. The City prepaid the entire five years of the lease. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You should not just type your answers into Excel but should actually calculate the answers within the software program where calculations are required. Also have each problem on its own sheet of your Excel document. Then, use the "Save As" function (in the Excel "File" menu) to give this file a name that includes your last name and the assignment number (e.g., "Smith521.doc"). Be sure to save your work frequently on your computer. PROBLEMS 3. The voters of Salt Lake City authorized the construction of a new north-south expressway for a total cost of no more that $75 million. The voters also approved the issuance of $50 million of 5% general obligation bonds. The balance of the necessary funds will come from the following sources: $15 million from a federal grant and $10 million from a state grant. The City controls expenditures in capital project funds through project management. The City does not formally incorporate budgetary entries in the capital projects fund but it does use encumbrance accounting for control purposes. REQUIRED: Assuming the City maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare journal entries, in the Capital Projects Fund, for the following transactions. The City issued $50 million of 5% general obligation bonds at 101. ANSWER: The City transferred the premium to the appropriate fund. ANSWER: The City incurred bid-related expenditures of $1,000. ANSWER: The City signed a contract with the lowest competent bidder for $48 million. ANSWER: (e) The city received notice from the State that the grant had been approved and the proceeds will be forwarded to the City in the State's current fiscal year. ANSWER: The City received the federal grant in full. ANSWER: The City received a progress billing from the contractor for $10 million. The City pays the billing. ANSWER: Due for completion No later than 6/10/2012 at midnight EST Dave McMahon All work where calculations are required must be completed in Excel with the calculations shown. You sh answers into Excel but should actually calculate the answers within the software program where calculations are PROBLEMS 4. The City of Brownsville engaged in the following transactions. REQUIRED: Assuming that the City m records in a manner that facilitates the preparation of fund financial statements, prepare the appropriate j a) The City purchased for cash three dump trucks at a unit cost of $70,000 each. ANSWER: b) The City sold for $3,000, a police car that had been purchased four years ago at a cost of $30,000. At the City estimated that the police car had a useful life of five years and a salvage value of $5,000. ANSWER: c) During the year, the City spent $12 million to build a third lane on both sides of the major north-south ANSWER: d) The City traded in a pickup truck used in general government operations for a new pickup truck, payin $16,000. The old pickup truck was purchased four years ago at a cost of $21,000. At the time it had an es ANSWER: e) During the year the City began construction of a new City Hall. By year-end, the City had made progre contractor of $2 million. ANSWER: f) The City received a gift of land from a citizen. The land is to be used to build a city park. The land ha Marshall's family since it was homesteaded. It had a fair value when contributed of $2 million. ANSWER: David McMahon Answers Due No later than 12:00 P.M. 6/10/12! 1. Under the modified accrual basis of accounting, derived nonexchange revenues are recognized when: Choose one answer. a. they are earned. b. they are measurable and available to finance the expenditures of the current period. c. the underlying exchange transaction occurs. d. the underlying exchange transaction occurs and they are measurable and available to finance the expenditures of the current period. 2. The debt service fund of a governmental entity is accounted for using which of the following bases of accounting? Choose one answer. a. Budgetary basis. b. Cash basis. c. Modified accrual basis. d. Accrual basis. 3. A City issued bonds for the purpose of financing a major capital improvement. Which fund is the most appropriate fund in which to record the receipt of the bond proceeds? Choose one answer. a. General Fund b. Special Revenue Fund c. Capital Projects Fund d. Debt Service Fund. 4. The City of St. Joe had outstanding $5 million of 6% bonds with a call provision. Due to changes in the prevailing interest rates, the City issued new bonds at 4.5% and used the proceeds to call the 6% bonds. This is an example of :Choose one answer. a. Debt retirement. b. Debt refunding. c. In-substance defeasance. d. Economic defeasance. 5. Characteristics of capital projects include: Choose one answer. a. Involves long-lived assets b. Usually requires long-range planning and extensive financing c. Usually has a year-to-year focus d. All of the above e. A & B only 6. General fixed assets are excluded from governmental funds because: Choose one answer. a. The measurement focus of governmental funds is on financial resources b. They are not used to used generate revenues. c. The basis of accounting is accrual. d. None of the above. 7. The City of Shiloh sold a used police car. The police car had a historical cost of $17,000, a fair value of $12,000, and was sold for $5,000. Assuming that the City maintains its books and records in a manner to facilitate the preparation of the fund financial statements, what is the appropriate entry in the General Fund to record this sale? Choose one answer. a. Debit Cash $5,000; Credit Revenue $5,000. b. Debit Cash $5,000 and Loss on Sale $7,000; Credit Automotive Equipment $12,000. c. Debit Cash $5,000; Credit Other Financing SourcesSale of Asset $5,000. d. Debit Cash $5,000; Credit Automotive Equipment $5,000. 8. Which of the following costs will NOT be included in the cost of fixed assets on the government-wide financial statements? Choose one answer a. Purchase price (invoice amount). b. Cost of demolishing existing structures that cannot be used. c. Interest on self-constructed items. d. Engineering costs. 9. Donated assets are reported in the government-wide financial statements as: choose one answer a. Historical cost to the donor. b. Book value in the hands of the donor. c. Fair value on date of donation. d. Zero value because they were not purchased. 10. Which of the following is NOT an infrastructure asset? Choose one answer. a. Roads. b. Sidewalks. c. Buildings. d. Bridges. 11. GASB standards require that depreciation be reported on all capital assets except: Choose one answ