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ACC 410 QUIZ 3

ACC 410 QUIZ 3

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Author: Christine Farr
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As used in governmental accounting, interperiod equity refers to a concept of

The modified accrual basis of accounting is used in presenting the fund financial statements of  the governmental funds because

Under the accrual basis of accounting, fines, license fees, permits, and other miscellaneous revenue are generally recognized

Under the accrual basis of accounting, property tax revenues are recognized

Under GAAP, license and permit fees should be recognized in the fund financial statements in the accounting period

Under the accrual basis of accounting, gains and losses on disposal of fixed assets

A city receives a $200,000 grant from the state to purchase vans to transport physically challenged individuals.  During  the current year the city receives the entire $200,000 and purchases one bus for $85,000 and issues a purchase order for another van for $80,000.  The grant revenue that the city should recognize on the government-wide financial statements in the current year is

A City levies a 2% sales tax that is collected for them by the State.  Sales tax must be remitted by the merchants to the State by the 20thday of the month following the month in which the sale occurred.  The State has a policy of remitting sales taxes to the City within 30 days of collection by the State.  Cash received by the State related to sales tax is as  follows:                        Amount received 1/20/00, applicable to December 1999 sales                                $  50                        Amount received 2/20/00, applicable to January 2000 sales                                   $  15                        Amount received 3/20/00, applicable to February 2000 sales                                 $  10 Amount received during 2000 related to March-November 2000 sales                    $190                        Amount received 1/20/01 for December 2000 sales                                              $  55                        Amount received 2/20/01 for January 2001                                                          $  20                        Amount received 3/20/01 for February 2001                                                        $    5 Assuming the City uses the same period to define “available” as the maximum period allowable for property taxes, what amount should it recognize as sales tax revenue in its government-wide financial statements for the fiscal year ended 12/31/00.

Under the accrual basis of accounting used by a governmental entity, investment revenues for the current period should include



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