CGFM Online Practice Questions and Answers

Debt refunding proceeds would be reported as:

A. a revenue.

B. a liability.

C. an other financial use on the operating statement.

D. an other financing source on the operating statement.

Based upon the performance measures report below provided to a local governmental oversight committee, what conclusions may be made?

A. More fire engines and fire companies are needed.

B. The arson task force fielded in FY07 is having a significant impact.

C. A fire engine bond issuance is needed.

D. State fire marshal mandates are being met.

Internal controls are the primary responsibility of:

A. the financial systems.

B. internal auditors.

C. management.

D. external auditors.

The objective of financial and non-financial performance measures is to:

A. demonstrate probity and legality in the handling of public funds.

B. demonstrate taxpayer preference in allocation of funds.

C. assess policy and reasonableness of budget allocation.

D. assess government performance and program accountability.

Proprietary and fiduciary funds use the economic resources measurement focus and the accrual basis of accounting. Proprietary funds focus on changes in economic resources, similar to private sector businesses, asking:

A. What transaction and events have increased the fund's total economic resources during the reporting period, measured by changes in net assets like revenues and expenses?

B. What transaction and events have decreased he fund's total economic resources during the reporting period, measured by changes in net assets like revenues and expenses?

C. What transaction and events have increased or decreased he fund's total economic resources during the reporting period, measured by changes in net assets like revenues and expenses?

D. None of these

In non-reciprocal interfund activities transfers without repayment may occur because?

A. A proprietary fund is self-supporting

B. A proprietary fund is not self-supporting

C. For instance a public transit system may require a transfer form the general fund because fares and other revenues do not offset costs.

D. None of there

Initially Line item budgets were used by the local governments but afterwards more reformed practices has taken its place and grouped its purpose. Those refined and more manageable categories are all EXCEPT:

A. Salaries

B. Supplies C. Equipment

D. Loans

The local car dealer in town can provide the 10 new cars the city needs at cost of $150,000. If local preferences were given, what would the preference margin (PM) be, assuming the dealer pays $50,000 in local property and sales taxes and that the total sales by the dealer are $2,000,000?

A. $325 per vehicle

B. $375 per vehicle

C. $370 per vehicle

D. $380 per vehicle

Assume an invoice with credit terms of 2%/10, net30. The interest charge is 2% of $1000, or $20; the principal is $980; and the days of principal borrowed are the 20 days of credit. What is the interest rate offered if the discount is taken?

A. 37%

B. 37.23%

C. 37.33%

D. 37.35%

The primary objectives, in priority order, should be:

A. Safety

B. Liquidity

C. Yield

D. All of these

The Unites Way receives $1,500,000 in funds in a lump sum at the beginning of the year and has constant cost and predictable annual cash outlays. Eight percent is estimated to be earned at securities with each security transaction costing $40 plus 0.5 percent of the dollar amount received. What will be the optimum security scale using Baumol Model?

A. $38700

B. $38730

C. $38830

D. None of these

Under the ___________ arrangement, governments completely outsource the reconciliation to the bank, which reports items issued and paid, issued but not paid, and not yet issued.

A. Partial reconciliation

B. Full reconciliation

C. Reverse positive pay

D. None of these

A building with a replacement value of $1,000,000 has depreciated by 50%. What amount of risk has been unwittingly assumed?

A. $500,000

B. $550,000

C. $600,000

D. None of these

Small local governments in states not requiring a financial audit may choose:

A. A compilation

B. Review or Member's audit

C. Agreed-upon procedures

D. Any of these

To issue bonds, a government depends on many specialists including:

A. Consulting engineer

B. Financial adviser

C. Bond counsel

D. All of these