Chapter 2 The Use of Funds in Governmental Accounting LO 2 MC2-15. Under the modified accrual basis of counting for a government property tax revenues show be recognized in the accounting period in which they G are levied b are collected in cash c are levied, subject to a provision for collectible receivables d/ are levied and become measurable wil available LO 3 MC3-16. A city-owned electric utility, which serves primarily the city's residents, sends a bill to the city for electricity provided to the police, sanitation and other operating departments. Which pair o funds is needed to record this transaction! Enterprise Fund and General Fund Enterprise Fund and Special Revenue Fund Internal Service Fund and General Fund d. Internal Service und and Special Revenue Fund LO 2 MC2-17 A city's General Fund transfers resources to the Debt Service und How should the transfer out of the General Fund and into the Debt Service Pund he reported in the governmental funds statement of revenues, expenditures and changes in fund balance? a. As expenditures of the General Fund and revenues of the Debt Service Fund b. As adjustments of the beginning of year fund balances of both funds They should not be reported because the transfers out and in offset each other As transfers in and out in the Other financing sources (uses) section of the statement LO 3 MC2-18. Which of the following statements is the reading accounting for capital assets by state and local governments? Capital outlays are recorded as expenditures in Internal Service Funds b. Capital outlays are recorded as assets in Enterprise Funds, but the depreciation on those assets is recorded in the General Fund, c. Capital outlays are recorded as assets in Enterprise Funds and are depreciated in those funds. d. Capital outlays are recorded as assets in Internal Service Funds, but are not depreciated. LO 4 MC2-19. A state government collects sales taxes for the state and for all counties within the state that levy a sales tax lg which fund should the state record the liability for sales taxes it holds for the counties, paling remittance of the cash to them? Custodial Fund 12 b. Special Revenue Fund c. Internal Service Fund d. Enterprise Fund LO 4 MC2-20. Pursuant to a trust agreement, a county invests idle cash owned by school districts within the county until the school districts need the cash. Which fund should the county use to report the activities and balances held for the school districts? a Custodial Fund Investment Trust Fund Internal Service Fund d. Special Revenue Fund LO 3 MC2-21. Which of the following funds is likely to have the caption "long-term bonds payable" in its fund balance sheet/statement of net position? a. Capital Projects Fund b. Enterprise Fund c. General Fund Debt Service Fund LO 3 MC2-22. Which of the following funds is likely to have the caption equipment" in its fund balance shept/statement of net position? w Capital Projects Fund b. Custodial Fund c. Enterprise Fund d. General Fund