Reference no: EM131761367

Class Participation Discussion Questions

1. All companies use budgets in planning and control. Governmental entities, however, have special budget issues. What is unique about the budget processes for governmental entities?

2. Accounting for governments involves the use of budgetary accounts. What are these accounts and how are they used?

3. Why is it important that governments coordinate their processes for developing appropriations budgets with those for developing capital budgets?

4. Is there a best type of budget for governments to use? Does this depend on the type of budget, explain.

5. Why do most governments budget on a cash or near-cash basis even though the cash basis does not capture the full economic costs of the activities in which they engage?

6. A political official boasts that the year-end excess of revenues over expenditures was significantly greater than was budgeted. Are "favorable" budget variances necessarily a sign of efficient and effective governmental management? Explain.

7. In what way will budgetary entries and encumbrances affect amounts reported on year-end balance sheets or operating statements?

8. How is reserve for encumbrances reported on a year-end balance sheet?