The following are the properties of the sinking fund formula except: a. Gives uniform annual charge b. It creates accumulation of funds for replacement c. Used for economy study purposes d. Property can never depreciated to zero value
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The following are the properties of the sinking fund formula except:
a. Gives uniform annual charge
b. It creates accumulation of funds for replacement
c. Used for economy study purposes
d. Property can never
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- If an internal service fund is intended to operate on a cost-reimbursement basis, then user charges should a. cover the full costs, both direct and indirect, of operating the fund. b. cover the full costs of operating the fund and provide for future expansion and replacement of capital assets. c. cover at a minimum the direct costs of operating the fund. d. do all of the above.What type of the fund is alloted to capital project?Select one:a. Special revenue fundb. Government fundc. General fundd. None of the other pointsThe fund that records the payment of principal and interest associated with long-term debt is the _________________, and the fund that records construction project activity is the _______________. None of these capital projects fund; debt service fund general fund; permanent fund capital projects fund; general fund debt service fund; capital projects fund
- What is the purpose of a special revenue fund? Choose the correct.a. To account for revenues legally or externally restricted as an operating expenditure.b. To account for ongoing activities.c. To account for gifts when only subsequently earned income can be expended.d. To account for the cost of long-lived assets bought with designated funds.For each of the following accounts indicate in which fund type it could be found. Select your answer from the following responses: A. Governmental funds only. B. Proprietary funds only. Bond Proceeds Long Term liability for Compensated Absences Deferred Inflows/Outflows of Resources Taxes Receivable Estimated Revenues Operating RevenuesTo get a project's after-tax cash flow, you must subtract depreciation as though it is an expense from the taxable income and then add it back again as though it is a positive cash flow to get the final net cash flow.a. Trueb. False
- Which of the following statements is not true as regards to matching strategy? a. all assets should be financed with permanent long-term capital. b. temporary current assets should be financed with temporary working capital c. permanent current assets should be financed with permanent working capital. d. long-term assets should be financed from long-term capital.Which of the following is not considered an “other long-term investment?” Sinking fund Preference share redemption fund Contingency fund Tax fundHow to record a trade-in? A.) Government Wide :Record at ticket price of the new asset B.) Fund statement: only the cash aspects of the transaction be recognized as expenditures C.) Losses and gains should be recognized on fund statements. D.) No losses and gains should be recognized on government wide financial statement
- The figures are for illustrative purposes and are not based on past performance with respect to the fund where your policy is linked. The investment returns used are for illustrative The returns are likely to change during the period. Also, the assumed returns do not represent the upper and lower limits of the actual return that may be realized. Values are calculated assuming the fund is earning 6%*, 8%* and 12%*. It is assumed that mode of payment is ANNUITY DUE.Which of the following neither increases nor decreases fund balance of the General Fund during the current period? a. Revenues. b. Other financing sources. c. Deferred revenues. d. Expenditures.When funds are borrowed to pay for construction of assets that qualify for capitalization of interest, the excess funds not needed to pay for construction may be temporarily invested in interest-bearing securities. Interest earned on these temporary investments should be? A) multiplied by an appropriate interest rate to determine the amount of interest to be capitalized. B) offset against interest cost incurred during construction. C) recognized as revenue of the period. D) used to reduce the cost of assets being constructed.