A city’s General Fund transfers resources to the Debt Service Fund. How should t
ID: 2331239 • Letter: A
Question
A city’s General Fund transfers resources to the Debt Service Fund. How should the transfer out of the General Fund and into the Debt Service Fund be 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
c. They should not be reported because the transfers out and in offset each other
d. As transfers in and out, in the Other financing sources (uses) section of the statement
MC2-18. Which of the following statements is true regarding accounting for capital assets by state and local governments?
a. 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.
MC2-19. A state government collects sales taxes for the state and for all counties within the state that levy a sales tax. In which fund should the state record the liability for sales taxes it holds for the counties, pending remittance of the cash to them?
a. Custodial Fund
b. Special Revenue Fund
c. Internal Service Fund
d. Enterprise Fund
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
b. Investment Trust Fund
c. Internal Service Fund
d. Special Revenue Fund
Explanation / Answer
MC2- 18. Answer is B, Because feprecdeprec are to be calculated for each and every asset is an enterprises.
MC-2-20 ,Answe Ais B ,Beca Bec every trust made agreement are need to be done with trust fund only
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