Ives6e_TIF_ch08 - Chapter 8 The Governmental Fund...

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Chapter 8: The Governmental Fund Accounting Cycle--Fiduciary Funds Multiple Choice 1. Which of the following characteristics is true of fiduciary funds? a. they report restricted fund balances b. their net assets are unavailable to finance government programs c. they prepare statements of cash flows for external reporting d. their net assets cannot have debit balances under any circumstances Answer: b 2. If a government participates in a defined contribution pension plan, which of the following always will be true? 3. Which of the following types of pension plans requires the involvement of an actuary on a regular basis? Defined Defined Benefit Contribution 4. Which of the following is not a fiduciary fund? 5. Which of the following is not a characteristic of a defined benefit pension plan?
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a. Benefits are based on actual contributions plus amounts earned on the contributions b. Benefits are linked to the number of years worked by the employee c. Benefits are based on a formula that considers salaries earned by the employee d. Benefits, rather than contributions, are guaranteed by the employer Answer: a 6. On what basis are investments valued in the financial statements of a Pension Trust Fund? 7. Which of the following statements is true regarding an agent multi-employer pension plan? 8. Under which of the following circumstances will a government maintain a Pension Trust Fund?
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