53. (True or false - financial reporting and other items)
State whether these statements are true or false. Discuss why the false statements are false.
a.All the long-term debt of a government, including the long-term debt that will be financed by Enterprise Fund revenues, is reported in the fund-level financial statements.
b.Long-term liabilities resulting from the
operating activities
of a General Fund, such as accrued vacation leave, are reported in the fund-level financial statements. Long-term liabilities resulting from the
capital acquisition activities
of a Capital Projects Fund, however, are not.
c.For financial reporting purposes, operating transfers from one fund to another are generally reported in a separate section of the operating statements for each of the funds.
d.For financial reporting, current assets and liabilities are separated from long-term assets and liabilities in the balance sheets of Enterprise Funds.
e.All funds report both financial resources and capital resources.
54. (Comparative computations of expenditures and expenses based on the same underlying transactions)
A department of a local government began operations at the beginning of the current fiscal year with $250,000 cash. During the fiscal year, the department made cash disbursements for the following:
# Salaries and other personnel costs, $100,000
# Office rent and utilities, $24,000
# Retirement of debt principal, $10,000; payment of interest, $2,200
# Purchased equipment at the beginning of the fiscal year for $30,000; the equipment is expected to last 6 years and have a salvage value of $6,000
# Photocopier rental, $10,500
Based on the preceding transactions, compute total annual
expenditures
for this department assuming it performs governmental-type activities and is accounted for in the General Fund.
Then compute total annual
expenses
for this department assuming it performs activities within an Enterprise Fund.