Question

True False 1. Capital projects funds account for proceeds of specific revenue sources that are legally required to be spent for specified purposes. 2. Utility bill payments are recognized in a proprietary fund. 3. The economic resources measurement focus is used to report the government-wide financial statements. 4. Capital assets and long-term liabilities specifically related to proprietary funds activities are accounted for using the modified accrual basis of accounting. 5. Governmental funds are accounted for using the accrual basis of accounting. 6. Government-wide financial statements report general long-term liabilities.

Answer 1

The student provided six true or false statements related to governmental accounting; five were confirmed as true and one as false - capital assets and long-term liabilities in proprietary funds use accrual accounting.

Step-by-step explanation:

Let’s review each statement related to governmental accounting and funds:

1. Capital projects funds account for the proceeds of specific revenue sources that are legally required to be spent for specified purposes. True
2. Utility bill payments are recognized in a proprietary fund. True
3. The economic resources measurement focus is used to report the government-wide financial statements. True
4. Capital assets and long-term liabilities specifically related to proprietary funds activities are accounted for using the modified accrual basis of accounting. False, they use the accrual basis.
5. Governmental funds are accounted for using the accrual basis of accounting. False, they use the modified accrual basis.
6. Government-wide financial statements report general long-term liabilities. True

When considering these statements, it is important to note that they align with the foundational principles of governmental accounting, such as different funds and measurement focuses for various activities and statements. Also, making decisions on such funds and financial reporting is closely tied to broader financial decision-making processes and structures in the public sector.

Answer 2

Answer and Explanation:

1. The given statement is false as the specific projects are those projects that are funded for the specific or particular task

2. The given statement is true as the bill payment made for utility would be recorded in a proprietary fund

3. The given statement is true as the measurement of the economic resources would be recognized in the financial statement i.e. government wide

4. The given statement is true as the capital assets and long term liabilities that related to the proprietary find would be accounted under modified accrual basis

5. The given statement is true as for the government funds as well, it used the accrual basis

6. The given statement is true as the financial statement i.e. government wide would recognize the long term liabilities