Question

The billings for transportation services provided to other governmental units are recorded by an internal service...

The billings for transportation services provided to other governmental units are recorded by an internal service fund as what types of transactions? Defend your answer – explain and cite your source.

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Answer #1

The billings for transportation services provided to other governmental units are recorded by an internal service fund as operating revenues. Operating revenues are those kind of revenue which is generally generated from a firm's day to day operations or activities. These revenues are generated from selling the products or rendering the services, it is a planned and consistent revenue.

As we see in the case of transportation services provided to other governmental units are the same case of rendering services of the firm on day-to-day basis or periodic basis and more of it is in the same division of government but in another unit, because of these reasons it is recorded as operating revenues.

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