PHIL 210 Chapter 6 & 7 Quiz LATEST (100% CORRECT ANSWERS) – Strayer University | PHIL210 Chapter 6 & 7 Quiz LATEST (100% CORRECT ANSWERS)

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PHIL 210 Chapter 6 & 7 Quiz 2020 – Strayer University Chapter 6 & 7 Question 1 0 out of 4 points Adams County has outstanding $10 million in bonds issued by the County to construct a ... sewer system in a specific area of the county. The taxpayers in that area voted for the construction and the bonds and agreed to tax themselves to pay the principal and interest on the bonds. The County contracted for the construction and issued the bonds but the City assumed no legal or moral obligation for the bonds. If the special tax payments are not sufficient to make the required principal and interest payments, the County will not make up the difference. The $10 million of bonds should appear in which fund financial statements or schedule? Answer Question 2 0 out of 4 points 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 Answer Question 3 0 out of 4 points Calhoun County makes annual transfers from the general fund to the debt service fund to pay principal and interest on long-term debt. In the debt service fund, what is the appropriate entry when the principal payment is made? Answer 4 out of 4 points In which fund type would a governmental entity’s debt service fund be found? Answer Question 5 0 out of 4 points Harbor City issued 6% tax-exempt bonds and used the proceeds to acquire federal government securities yielding 7%. After paying the interest on the tax-exempt bonds, the City cleared 1%. This is an example of Answer Question 6 0 out of 4 points 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 Answer Question 7 4 out of 4 points 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 Answer Question 8 4 out of 4 points In which fund type would a governmental entity’s capital project fund be found? Answer Question 9 0 out of 4 points Sugar City issued $2 million of bonds to fund the construction of a new city office building. The bonds have a stated rate of interest of 5% and were sold at 101. Which of the following entries should be made in the Capital Project Fund to record this event? Answer Question 10 4 out of 4 points The capital project fund of a governmental entity is accounted for using which of the following bases of accounting? Answer 4 out of 4 points 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 capital project fund Answer Question 12 0 out of 4 points Sister City was notified by the State that they had been awarded a $6 million grant to aid in the construction of a senior citizens center. At the time of the notification what is the appropriate entry in the capital project fund (assuming that the City maintains its books and records in a manner to facilitate the preparation of the fund financial statements)? Answer Question 13 4 out of 4 points The debt service fund of a governmental entity is accounted for using which of the following bases of accounting? Answer Question 14 0 out of 4 points Previously Atomic City had issued bonds with a face value of $10 million to construct a new city hall. Because the money will not be needed for several months, the city invested the bond proceeds in U.S. Government securities. Assuming that the city maintains its books and records in a manner that facilitates the preparation of the fund financial statements, what is the appropriate entry when the City receives interest on the investments? Answer Question 15 0 out of 4 points 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? Answer Special Revenue Fund. Capital Project Fund. Question 16 4 out of 4 points Which of the following costs will be included in the cost of land on the government-wide financial statements? Answer All of the above. All of the above. Question 17 4 out of 4 points Which of the following is NOT an example of a derivative? Answer Repurchase agreements. Repurchase agreements. Question 18 0 out of 4 points With regard to capitalization of infrastructure, which of the following is true? Answer All infrastructure must be capitalized on the financial statement before GASB Statement No. 34 can be implemented. Small governments may omit capitalizing all infrastructure acquired before the date on which they implement GASB Statement No. 34. Question 19 0 out of 4 points A broker-dealer or other financial institution transfers cash to a government in exchange for securities and the government agrees to repay the cash plus interest and return the securities. From the government's point of view, this transaction is a Answer Repurchase agreement. Reverse repurchase agreement. Question 20 4 out of 4 points The risk that the other party to an investment will not fulfill its obligation is Answer Credit risk. Credit risk. Question 21 0 out of 4 points If a government elects the modified approach with regard to capitalization of infrastructure Answer Costs to preserve infrastructure assets are expensed as incurred with no additional disclosure required. Costs to preserve infrastructure assets are expensed as incurred and disclosure of assessed condition is required. Question 22 0 out of 4 points 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 Answer No entry is required for contributed assets. Debit Expense, Credit Revenue. Question 23 0 out of 4 points A governmental entity may record long-term assets in which of the following funds or account groups? Answer Capital Project Fund Internal Service Fund. Question 24 0 out of 4 points Investments, other than bank balances, must be classified into one of three categories. Which of the following is NOT one of those categories? Answer Uninsured and unregistered, with securities held by the other party’s trust department or agent in the government’s name. Uncollateralized. Question 25 4 out of 4 points The objectives of financial reporting for fixed assets should be to provide information Answer All of the above. All of the above. Question 26 0 out of 4 points GASB standards require that depreciation be reported on all capital assets except Answer Capitalized works of art. Infrastructure assets accounted for on the modified approach. Question 27 0 out of 4 points If a government receives a donation of a work of art, the government must recognize revenue Answer Only if it elects to capitalize its collection. On all donations of works of art. Question 28 4 out of 4 points To elect not to capitalize works of art and similar assets, a government must see that the assets meet all of the following criteria except: Answer Question 29 4 out of 4 points Donated assets are reported at Answer Question 30 4 out of 4 points General fixed assets are excluded from governmental funds because Answer [Show More]

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