Question 1

Which of the following situations may cause contingent liabilities?

Options :

A : loss on the sale of an asset

B : building with asbestos

C : impairment of an asset

D : unrealized loss

Answer: B

Question 2

In state and local financial audits, material weaknesses must be reported to the

Options :

A : legislature.

B : governing body.

C : taxpayers.

D : local media.

Answer: B

Question 3

The federal budget baseline forecast reflects the estimated

Options :

A : receipts, outlays, and deficit or surplus under the President's Budget.

B : effects of enacting Congressional appropriations bills on federal receipts and spending.

C : receipts, outlays, and deficit or surplus that would result from continuing current law or policies.

D : effects of current law on recipients of federal benefits.

Answer: C

Question 4

For state and local governments, a fund that is legally restricted to the use of earnings with the principal protected is

Options :

A : an enterprise fund.

B : a permanent fund.

C : an internal service fund.

D : a general fund.

Answer: B

Question 5

A legally separate organization for which the elected officials of the primary government are financially accountable describes a

Options :

A : fiscally dependent organization.

B : component unit.

C : joint venture entity.

D : jointly governed organization.

Answer: B