Outbound cash flow is any money a company or individual must pay out when conducting a transaction with another party. The utility has a corresponding receivable from the general fund. A firm's cash flows from investing activities include: A) Cash received from the sale of a plant asset B) Cash paid as dividends C) Cash received from the rendering of services to customers Statement of Net Assets; Statement of Revenues, Expenses, and Changes in Fund Net, Over the long run, governmental internal service funds are intended to. Generate revenues sufficient to cover the full costs of providing services. The payable should be reported in the governmental activities column and the receivable in the business-type activities column. On its government wide statements this amount would be recorded as an asset in the, In its first year of operation, a self-insurance internal service fund billed the general fund $500,000 for premiums. Outflow: purchase of PP&E including software and website development 2. In the utility fund statement of cash flows, the receipt would be reflected as a cash flow from, A city's transportation service, which is accounted for in the enterprise fund, has an outstanding balance $10 million in revenue bonds. Operating activities are those that pertain to a company's core business activities, such as manufacturing, distributing, marketing and selling a service. Statement of changes in fund net position, A government need not necessarily account for an activity in an enterprise fund even though it, Charges fees for an activity and those fees are material in amount, Government business-type activities must apply, All FASB pronouncements incorporated into GASB Statement No. Cash flows from investing activities include all of the following except: a. Outflow: acquisitions, net of cash acquired 4. In what way would the statement of cash flows of a government owned electric utility differ from that of a privately owned counterpart? D. Cash … The reporting of activities by an Enterprise Fund is most likely optional if: a) Fees are charged to external users for goods or services. Billing rates must be set to cover the full cost of providing the goods or services. In the Statement of Net Assets, the net assets of a proprietary fund should be displayed in, Unrestricted Net Assets; Restricted Net Assets; Invested in Capital Assets, Net of Related, A Statement of Revenues, Expenses, and Changes in Fund Net Assets should include which, Nonoperating revenues and expenses, Capital Contributions and Other Changes in Net, In which of the following circumstances must an enterprise fund be used to account for the, To finance the acquisition of plant facilities, a newly created electric utility issues. In both the fund statements and the government-wide statements, business-type activities and, The operating statement required as one of the three basic financial statements for, The amounts reported in proprietary fund statements are generally the same as those reported, Governments are required to prepare a statement of cash flows for proprietary funds, but not, GASB Statement No. In the Proprietary fund statements, without any interfund eliminations. As a consequence of these transactions, the insurance fund would report on its statement of net position, A city makes an interest payment of $6 million on its utility fund revenue bonds that were issued to finance new sewer lines. A proprietary fund of a governmental entity has donor-restricted assets on its balance sheet. Cash flow from Investing Activities is the second of the three parts of the cash flow statement that shows the cash inflows and outflows from investing in an accounting year; investing activities includes cash flows from the sale of fixed asset, purchase of a fixed asset, sale and purchase of investment of business in shares or properties, etc. The entity can provide the services more cheaply or efficiently than can a private firm. Which of the following is NOT true about internal service funds as reported in the fund. 34 mandates that governments report their cash flows from operations, The FASB mandates entities report their cash flows from operations using the direct method, Governments generally do not have to get formal legislative approval for enterprise fund, In accounting for closure and postclosure landfill costs in an enterprise fund, a government, The revenues of an internal service fund are the expenditures and expenses of other funds of, The proprietary fund operating statement includes ALL changes in net assets including, The appropriate measurement focus for the business-type activities of the City of Rockford is. In the city's government wide statements, which would be correct? 62 that the pronouncement indicates is applicable to the activity at hand, Tap fees, a portion of which exceed the cost of hooking customers into the utility, should be accounted for as, a combination of capital contributions and ordinary revenues, Landfill closure and post-closure cost should be recognizes as expenses, in the period that the landfill is in operation.

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