Question

Kenn City obtained a municipal landfill and passed a local ordinance that required the city to operate the landfill so that the costs of operating the landfill, as well as the capital costs, are to be recovered with charges to customers. Which of the following funds should Kenn City use to report the activities of the landfill?

A. Enterprise
B. Permanent
C. Special Revenue
D. Internal service

Answer 1

A. Enterprise

Step-by-step explanation:

Enterprise is the type of government fund whereby goods and services are sold for a fee. It is a government owned fund that sells goods and services to the general public. It is used by a municipality to report an activity for which a fee is charged to users for goods and services. It is a self supporting activity of a government unit that renders services on a user fee basis. In this scenario, what kenn city use in reporting the stated activity is Enterprise fund.

Answer 2

A. Enterprise

Step-by-step explanation:

Based on the scenario being described it can be said that in this situation Kenn City should use an enterprise fund to report the activities of the landfill. This is government fund that sells goods and services to the public for a fee. Therefore since the costs for operating the landfill are to be recovered with charges to customers then this would be the fund to report to.