QUESTION7 2 points The city is using an internal service fund to self-insure its
ID: 2392269 • Letter: Q
Question
QUESTION7 2 points The city is using an internal service fund to self-insure its risk financing activities. Claims accrued or paid by this fund are recorded as: O A Nonoperating Expenses. O B. Special Items. C. Transfers out. O D. Operating Expenses. 2 points QUESTION 8 Revenue bonds O A. Are intended to be paid from the revenues of an enterprise. O B. Are backed by the full faith and credit of the government in addition to enterprise revenues. O C. Carry less risk than general obligation bonds. 0 D. Are no longer in existence.Explanation / Answer
1. The city is using an internal service fund to self-insure its risk financing activities. Claims accrued or paid by this fund are recorded as:
Operating Expenses, Option D is correct answer.
2. Revenu Bonds,
Are intended to be paid from the revenues of an enterprise.
Option A is correct Answer.
3. The two types of proprietary funds include:
Enterprise funds and internal service funds. Option B is correct answer.
4. When preparing the Statement of Cash Flows for the Proprietary Funds, cash flows from noncapital financing activities include all of the following,
Grants received from and paid to other governments for noncapital purposes; Proceeds and repayment of debt not clearly related to capital outlay; Transfers to and from other funds;
EXCEPT
Receipts from customers. Option D is correct answer.