Exam (elaborations)
WGU PRACTICE QUESTIONS C252 CHAPTER 10/32 QUESTIONS AND ANSWERS (A+)
- Institution
- WGU PRACTICE QUESTIONS C252 CHAPTER 10
WGU PRACTICE QUESTIONS C252 CHAPTER 10/32 QUESTIONS AND ANSWERS (A+)
[Show more]
Content preview
WGU PRACTICEQUESTIONS C252
CHAPTER 10/32
QUESTIONS AND
ANSWERS (A+)
1. The use of an Enterprise Fund is required by
generally accepted accounting principles in each
of the following situations except
a. When user fees are charged for the majority of
the activity's operations.
b. When an activity is financed with debt that is
secured solely by the pledge of revenues.
c. When laws and regulations require that the
activity's costs be recovered with fees and
charges.
d. When pricing policies of the activity establish
fees and charges are designed for cost recovery. -
√Answer>When user fees are charged for the
majority of the activity's operations.
-2. Which of the following statements is false
concerning interest capitalization?
a. Generally accepted accounting principles
require the capitalization of certain types of
interest in Enterprise Funds.
,b. Interest cost should not be capitalized for asset
acquisitions financed by restricted gifts or grants.
c. Interest capitalization is computed differently for
tax-exempt versus taxable debt.
d. Interest capitalization is not allowed in
Enterprise Funds. - √Answer>Interest
capitalization is not allowed in Enterprise Funds.
-3. When accounting for inventory in an Enterprise
Fund, which method should be used for external
financial reporting?
a. Acquisition method.
b. Allocation method.
c. Consumption method.
d. Purchases method. - √Answer>Consumption
method.
-4. A city Enterprise Fund received an operating
grant during the fiscal year. The Enterprise Fund
will report this grant on the statement of revenues,
expenses, and changes in net position as
a. Operating revenues.
b. non-operating revenues.
c. other financing sources.
d. other financing uses. - √Answer>non-operating
revenues.
-5. The city, which has a December 31 year end,
was awarded a $400,000 federal grant for a
system hardware upgrade to meet FCC
, requirements. The grant was awarded and
distributed to the fund in June 20X7. However, the
capital project is not expected to be completed
until June 20X8. As of December 31, 20X7, the
Cable Enterprise Fund should
a. Report nonoperating revenues of $400,000.
b. Report nonoperating revenues of $200,000.
c. Report a capital contribution of $400,000.
d. Report a capital contribution of $200,000. -
√Answer>Report a capital contribution of
$400,000.
-6. Refunding bonds were issued by an Enterprise
Fund with a face value of $15,000,000 at a 1%
discount. Issuance costs were $225,000. The
entry to record the issuance of the refunding
bonds would be
a.
DR Cash $14,625,000
DR Expenditures 225,000
DR Other Financing Uses-Discount 150,000
CR Other Financing Sources-Bonds 15,000,000
b.
DR Cash $14,625,000
DR Expenditures 225,000
CR Other Financing Sources-Bonds 14,850,000
c.
DR Cash $14,625,000
DR Unamortized Deferred Charges/Discount
375,000
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller HELLENAH. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for £7.72. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
75057 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy revision notes and other study material for 14 years now