ACC 410 FINAL EXAM PART 1

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Voters in Phillips City approved the construction of a new $10 million city hall building and
approved a $10 million bond issue with a stated rate of interest of 6% to fund the construction.
When the bonds were issued, they sold for 101. What are appropriate entries related to the
premium? In the debt service fund

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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?
In which fund type would a governmental entitys capital project fund be found?
Voters in Lincoln School District approved the construction of a new high school and
approved a $10 million bond issue with a stated rate of interest of 6% to fund the construction.
Bids were received and the low bid was $10 million. When the bonds were issued, they sold for
face value less bond underwriting fees of $.5 million. The School Board voted to fund the
balance of the construction by a transfer from the general fund. The entry in the capital project
fund to record the receipt of the bond proceeds would be
The capital project fund of a governmental entity is accounted for using which of the following
bases of accounting?
Investments, other than bank balances, must be classified into one of three categories.
Which of the following is NOT one of those categories?
For a government that elects to capitalize its works of art and similar assets, the appropriate
entry when receiving a contribution of a work of art at the government-wide level is
Which of the following is NOT an infrastructure asset?
A governmental entity may record long-term assets in which of the following funds or account
groups?
For a government that elects NOT to capitalize its works of art and similar assets, the
appropriate entry when receiving a contribution of a work of art at the government-wide level is
A City entered into a long-term capital lease for some office equipment. Assuming the city
maintains its books and records in a manner to facilitate preparation of fund financial
statements, what entry would be made in the General Fund to record this event?
A governmental entity that is unable to satisfy claims against it
An obligation issued in the name of a government on behalf of a nongovernmental entity is
called
Southwest City enters into a lease agreement that contains a nonappropriation clause. The
clause
New City entered into a lease agreement for several new dump trucks to be used in general
government activities. Assuming the City maintains its books and records in a manner that
facilitates the preparation of the fund financial statements, acquisition of these dump trucks
would require entries in which of the following funds and/or schedules?

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The City of Brockton voted to establish an internal service fund to account for its printing
services. The City transferred $500,000 cash from the General Fund to the newly created
internal service fund. The appropriate entry in the General Fund to account for this transfer
would be a credit to cash for $500,000 and a debit for $500,000 to
Cash flows from Operating Activities does NOT include which of the following as cash
outflows?
On the fund financial statements, internal service activities should be presented
Which of the following is NOT a valid reason for governmental entities to engage in businesstype activities?
Franklin County operates a solid waste landfill that is accounted for in an enterprise fund.
The County calculated this years portion of the total closure and post closure costs associated
with the landfill to be $300,000. The entry(ies) to record this cost should be
A plans unfunded actuarially accrued liability is the excess of
Citizens within a defined geographic area of Hill City created a special assessment district to
facilitate the construction of sidewalks. Hill City was responsible for overseeing the entire
construction project. Hill City issued bonds in its own name to pay the contractor for the
construction. However, Hill City was not responsible in any manner for the bonds. The bonds
were secured by the special assessments which would be levied against the property within the
special assessment district. Collections of special assessments would be recorded in which of
the following funds of Hill City?
Previously a city received a $1 million gift, the income from which was restricted to support
maintenance of city-owned parks. During the current year the endowment earned $70,000 of
which $50,000 was transferred to the City Park Special Revenue Fund. On the year-end fund
financial statement, the endowment fund would report the $50,000 transferred to the Special
Revenue Fund as:
The City of Highland Hills receives a federal grant to assist in nutrition (feeding) programs for
senior citizens. The City will select the contractors to provide the feeding and approve the
participants in the program. The proceeds of this grant should be accounted for in which of the
following funds of the City?
A defined contribution pension plan is one in which the employer agrees to which of the
following?