Question

C7-Proprietary funds are accounted for in a manner similar to investor-owned businesses;

among other features,
the accrual basis of accounting is used and all of the capital assets used in fund
operations are accounted for by the using fund.

Answer 1

True

Step-by-step explanation:

Proprietary funds are a type of government fund that reports government activities financed by revenue generating government entities, e.g. municipal water utility company. This revenue generating government entities use the accrual basis of accounting similar to private companies. While most other government entities use the fund accounting system, not the accrual system.