Reference no: EM1350749

29. 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 projects fund (assuming that the City has met all eligibility requirements and maintains its books and records in a manner to facilitate the preparation of the fund financial statements)? (Points: 6)
a) No entry at the time of the notification.
b) Debit Grants Receivable $6 million; Credit Revenue $6 million.
c) Debit Grants Receivable $6 million; Credit Deferred Revenue $6 million.
d) Debit Grants Receivable $6 million; credit Other Financing Sourcesâ?"Transfer $6 million.

30. Previously Rose City issued bonds with a face value of $10 million to construct a new city maintenance facility. 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 a progress billing from the contractor? (Points: 6)
a) Debit Building; Credit Cash
b) Debit Building; Credit Accounts Payable.
c) Debit Expenditure; Credit Accounts Payable.
d) No entry is required.

31. The appropriate measurement focus for the business-type activities of the City of Rockford is (Points: 6)
a) Current financial resources.
b) Economic resources.
c) Both (a) and (b).
d) None of the above.

37. In previous years, Center City had received a $400,000 gift of cash and investments. The donor had specified that the earnings from the gift must be used to beautify city-owned parks and the principal must be re-invested. During the current year, the earnings from this gift were $24,000. The earnings from this gift should generally be considered revenue to which of the following funds? (Points: 6)
a) Special revenue fund.
b) Private-purpose trust fund.
c) Agency fund.
d) Permanent fund.

38. What basis of accounting is used to account for transactions of a governmental private-purpose trust fund? (Points: 6)
a) Full accrual basis of accounting.
b) Modified accrual basis of accounting.
c) Cash basis of accounting.

40. A wealthy citizen provided in her will for a gift of cash and other assets to the City. Her will specified that the gift was to be kept intact and that the earnings from the gift were to be used to support public parks. At the time of the donation, the gift had a book value in the hands of the donor of $250,000 and a fair value of $400,000. When recording this gift the City would credit (Points: 6)
a) Contributions revenues $400,000.
b) Other Financing Sourcesâ?"Contributions $400,000.
c) Contributions revenues $250,000.
d) Other Financing Sourcesâ?"Contributions $250,000.