Chap003 - CHAPTER 3: GOVERNMENTAL OPERATING STATEMENT...

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CHAPTER 3: GOVERNMENTAL OPERATING STATEMENT ACCOUNTS; BUDGETARY ACCOUNTING OUTLINE Number Topic Type/Task Status (re: 12/e) Questions: 3-1 Direct and indirect expenses Define 3-3 revised 3-2 Program and general revenue Distinguish 3-4 revised 3-3 Government-wide statement of activities Describe 3-5 revised 3-4 Special revenue funds Determine 3-6 3-5 Fund equity vs. net assets Define and compare 3-7 revised 3-6 Real accounts and budgetary accounts Distinguish 3-8 3-7 Expenditure classifications - examples Classify 3-10 revised 3-8 Revenue classifications Classify 3-11 revised 3-9 Budgets - GAAP basis Explain 3-13 3-10 Public school systems Explain 3-15 Cases: 3-1 Budgeting and information systems Internet, describe New 3-2 Government-wide statement of activities Internet, evaluate New 3-3 Charter school (public school academy) Internet 3-4 revised Exercises/Problems: 3-1 CAFR Examine Revised 3-2 Various Multiple Choice 3-2, 3-3, New 3-3 Saline City—budgets Journal Entries 3-4 revised 3-4 Saline City—appropriations (cont’d) Journal Entries 3-5 revised 3-5 GF trial balance and closing entries Calculate New 3-6 Subsidiary ledgers Calculate 3-7 3-7 Appropriations, Encumbrances, Expenditures Calculate 3-8 3-8 Government-wide statement of activities Prepare New 22
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CHAPTER 3: GOVERNMENTAL OPERATING STATEMENT ACCOUNTS; BUDGETARY ACCOUNTING Answers to Questions 3-1. Direct expenses are those specifically associated with a function or program. Indirect expenses are those that are not directly linked to an identifiable function or program. Depreciation expense is reported as a direct expense when it relates to capital assets that are clearly identified with a function or program. Even depreciation expense for infrastructure assets should be reported as a direct expense of the public works or transportation function, if that is the function responsible for those assets. Interest on general long-term liabilities is an indirect expense and should be reported as a separate line item before total governmental activities. 3-2. a. General revenues. b . General revenues . c. General revenues. d . General revenues. e . Program revenues. f. Program revenues. g. Program revenues. 3-3. The government-wide statement of activities prescribed by GASBS 34 will appear very different to most readers. Expenses are shown in the first column with rows that identify the function to which that expense is directly related (e.g., General Government, Public Safety, Recreation…). From expenses are subtracted the program revenues associated with those functions in columns moving to the right. Program revenues are segregated into three columns, charges for services, capital grants and contributions, and operating grants and contributions. The net expense (or revenue) is then displayed as either a component of governmental activities or business-type activities. The lower half of the statement of activities shows the general revenues that are recognized to subsidize the net expense of the program or functions not covered by program revenues. Users will be able to answer questions such as “How much do particular government
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Chap003 - CHAPTER 3: GOVERNMENTAL OPERATING STATEMENT...

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