Question

Impact of Government Events

Indicate how each of the following transactions impacts the fund balance of the general fund for fund-based financial statements, and what the impact is on the net asses balance for the governmental finds for government-wide financial statements.

Fund A transfers $20,000 to Fund B. For each of the following, indicate whether the statement is true or false and, if false, explain why.

a.If Fund A is the general fund and Fund B is an enterprise fund, nothing will be shown for this transfer on the statement of activities within the government-wide financial statements.

b.If Fund A is the general fund and Fund B is a debt service fund, nothing will be shown for this transfer on the statement of activities within the government-wide financial statements.

c.If Fund A is the general fund and Fund B is an enterprise fund, a $20,000 reduction will be reported on the statement of revenues, expenditures, and other changes in fund balance for the governmental funds within the fund financial statements.

d.If Fund A is the general fund and Fund B is a special revenue fund (which is not considered a major fund), no changes will be shown on the statement of revenues, expenditures, and other changes in fund balance within the fund financial statements.

e.If Fund A is the general fund and Fund B is an internal service fund and this is for work done, the general fund will report an expense of $20,000 within the fund financial statements.

Answer 1

A .False - A transfer out will be shown by the governmental activities. Transfer in will be reported by the business type activities. No overall mpact s shown in the total column for the government as a whole. But both figures do appear in their own seperate columns.

B. This is an intra activity transfer. Funds within the governmental activities are involved, this transfer creates no difference in the overall toal.

C. True The General Fund reports the resource outflow as on other financig use. Financial resources were reduced but it was not for an expenditure.

D. False The general fund will report the transfer out as an other financing use. All othr Funds coloumn will sshow the transfer in as an other financing source.

E. False. The General fun d does not report expenses in the fund.based financial statements but rather expenditures.