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CMFO Exam - Current Fund with Questions with Complete Solutions
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CMFO Exam - Current Fund with Questions with Complete Solutions
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CMFO Exam - Current Fund withQuestions with Complete Solutions
Types of assets accounts: - ✔✔1. Cash
2. Bank accounts
3. Investment accounts
4. Receivables
5. Deferred charges
What is the normal balance for a liability? - ✔✔- Liabilities have a normal CREDIT (CR) balance
- a credit entry increases the balance
- a debit entry decreases the balance
Types of Liability accounts: - ✔✔1. Tax overpayments
2. Prepaid taxes
3. Appropriation reserves
4. Payables
5. Reserves
What is a Reserve account? - ✔✔- reserve accounts are generally used to account for the offset
of receivables
What is the normal balance for a reserve? - ✔✔- reserves have a normal CREDIT (CR) balance
- a credit entry increases the balance
- a debit entry decreases the balance
,What is Fund Balance? - ✔✔- Fund Balance represents the EXCESS of total assets less total
liabilities - represents unused resources for future use
What is the normal balance of Fund Balance? - ✔✔- Fund Balance MUST have a CREDIT (CR) balance
- a credit entry increases the balance
- a debit entry decreases the balance
What type of account is a Revenue account? - ✔✔- a revenue account is a(n):
1. Income Statement account (Profit & Loss account)
2. Temporary account
What is the normal balance for a Revenue account? - ✔✔- revenue accounts do NOT have a
typical Normal balance.
Explain the general ledger transactions for Revenues: - ✔✔- starting with zero
- budgeted revenue is recorded as a DEBIT entry
- as revenue is received in cash, revenue accounts are CREDITED
What does it mean if a revenue account has a DEBIT balance? - ✔✔- if a revenue account has a
debit balance, it means that LESS revenue was collected than budgeted
What does it mean if a revenue account has a CREDIT balance? - ✔✔- if a revenue account has
a credit balance, it means that MORE revenue was collected than budgeted
At the end of the year (or accounting period), where are revenue accounts closed to? - ✔✔-
revenue accounts are closed to OPERATIONS
What are some types of Revenue accounts? - ✔✔1.
Taxes 2. Grants
, 3. Fees
4. Permits
5. Licenses
6. All other sources of operating money
What type of account is an Appropriation Account? - ✔✔An appropriation account is an:
1. Income Statement account (profit & loss account)
2. Temporary account
What is the normal balance for an appropriation account? - ✔✔- Appropriations SHOULD have
a CREDIT balance
Explain the general ledger transactions for appropriations: - ✔✔- starting with zero
- budgeted appropriations are recorded with a CREDIT entry
- encumbrances or expenditures paid are recorded as a DEBIT
What does it mean if there is a CREDIT balance in an appropriation account? - ✔✔- it means that
LESS expenditures were spent than appropriated
What does it mean if there is a DEBIT balance in an appropriation account? - ✔✔- it means that
the appropriation has been "over-expended"
- not allowed by state statute
At the end of the year, where are unspent appropriations closed out to? - ✔✔-
unspent appropriations are closed out to APPROPRIATION RESERVES
Appropriations are separated into two categories or line items. What are they? - ✔✔1. Salary
& Wages (S&W)
2. Other Expenses (OE)
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