Name________________________

Id. No_______________________
P.O.Box______________________
City (Town)___________________
Region (Zone)_________________

UNITY UNIVERSITY COLLEGE

SCHOOL OF DISTANCE AND CONTINUING EDUCATION

Worksheet for Government and Non-Profit Accounting (Acct 331)

This is a test paper you are expected to do on your own. It carries 15 points. The test
paper should be completed and mailed to the School of Distance and Continuing
Education for evaluation. Do not try to complete the worksheet until you have
covered all the lessons and exercises in the course material.

Any questions in the course that you have not been able to understand should be
stated on a separate sheet of paper and attached to this worksheet. Your tutor will
clarify them for you.

After completing this test paper, be certain to write your Name, Id.No and Address
on the first page. Your Name and Id.No on the other pages.
Part I: Write “True” if the statement is correct and “False” if the statement is
wrong on the answer sheet.

________1. Interest on bond anticipation notes payable may not be the expenditure of capital
projects fund.
________2. General Fixed Assets Account Group is both fiscal and accounting entity.
________3. All fiduciary finds use accrual basis of accounting.
________4. General long term debt account group is a fiscal entity.
________5. Depreciation is recorded as an expense or current period consumption of
resources in the General Fixed Asset Account Group.

Part II: Choose the best answer from the alternatives given and write the letter of
your choice on the answer sheet.

_______1. Which of the following term refers an estimate rather than an actual cost?
A. Estimated other Financing uses D. Other financing sources
B. Revenues E. Bond issue proceeds
C. Expenditures
_______2. An equipment is purchased from the resources of General Fund. The entry in
General Fund debited:
A. Revenues C. Expenditures E. Other financing uses
B. Cash D. Equipment
_______3. Which of the following is not considered as revenue of capital projects fund?
A. Interest on temporary investments
B. Grants
C. Equity transfer-In
D. Property taxes levied for the purposes
E. A and C
_______4. The Estimated Revenues account of a governmental unit is debited when":
A. The account is closed at the end of
B. The revenues are recorded
C. The budget is recorded at the beginning of the year

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 D. Tax receivables are collected
E. Tax receivables are written-off
_______5. When Debt Service Fund pays bound principal, the entry in the Debt Service Fund
debits:
A. Other financing uses D. Revenues
B. Amount to be provided E. Amount available
C. Expenditures
_______6. Depreciation on fixed assets is recorded in the accounts of:
A. general fund D. capital projects fund
B. enterprise fund E. debt service fund
C. special Revenue fund
_______7. Governmental types of funds differ from proprietary type funds in that
A. Governmental type of funds focus on spending measurement of accounting
B. Governmental type of funds employ a modified accrual basis of accounting
C. Proprietary type of funds focus on capital maintenance measurement of
accounting/income determination
D. All of the above
E. None of the above
_______8. The receipts from a special tax levy to retire and pay the general obligation bonds
issued to finance the construction of a new city hall should be recorded in:
A. a Debit service Fund D. a Special Revenue Fund
B. a Capital Projects Fund E. None of the above
C. a Revolving Fund
_______9. Under the modified accrual basis of accounting for a governmental unit revenues
should be recognized in the accounting period in which they:
A. become available and earned D. are collected
B. are earned and measurable E. None of the above
C. become available and measurable
_______10. As of the first day of a fiscal year, it is normally desirable to enter in Capital
Project Fund Account:
A. The amount of bond to be issued during the year

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 B. The Re-establishment of Encumbrances closed to fund balances of the end
of the proceeding year
C. The amount of grants expected to cover the financing of the project
D. Expenditures for the years
E. None of the above

Use the following data to answer questions 15 – 17

The entry appeared in the accounts of the General Fund.
Taxes Receivable (current) …………………………….. 100,000
Revenues ………………………………………………… 98,000
Allowance for uncollectible current taxes ………………. 2,000
_______11. The subsidiary Revenue account involved would most likely be:
A. Income Taxes D. Licenses and Permits
B. Property Taxes E. None of the above
C. Sales Taxes
_______12. The total Tax levy must have been
A. 96,000 C. 100,000
B. 98,000 D. 102,000
_______13. The recording of the receivable at a gross and the Revenue at net indicates
A. a budgetary appropriation for uncollectible tax expenses of 2,000
B. that responsibility for uncollectible taxes is a managerial function
C. that credit practices of commercial and governmental organizations are
similar
D. that uncollectible taxes are not included in budgetary appropriations
E. All of the above
_______14. If re-establishment is made by the Capital Projects Fund for Encumbrance, it is
recorded with a credit to:
A. Encumbrances C. Fund Balance
B. Reserved for Encumbrances D. Reserve for inventory of supplies
_______15. One of the following Assets does not refer to the sources of Debt Service Fund
A. Taxes assessed to service the debt
B. Transfer from the General Fund (and/or other funds)

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 C. Income from Investment of resources
D. All of the above
E. None of the above

Part II: Exercises

Consider the following transactions and answer on the space provided based on the
instruction.
a) Adam town is constructing municipal complex that is financed by Br. 10,000,000 par
value term bond issued at Br. 10,250,000 at the beginning of the current year. Any
premium is appropriated for Debt service fund. The construction is accounted for in
capital project fund. After six months, capital project fund has transferred the amount of
premium on bonds issued to Debt service fund. Records show that costs incurred in the
current year for construction amounted to Br. 4,200,000. The project is expected to
complete after a year.
Instructions
i) Identify the funds affected by the forgoing transactions and prepare the necessary entries
in these funds.

ii) Identify the account group(s) affected by the foregoing transactions and prepare the
necessary entries in them.

b) The town of Fiche has acquired land and building for cash at Br. 120,000 and Br.
130,000 respectively from its general fund revenues. Prepare the necessary entries in:
iii) General fund

iv) General Fixed Asset Account Group

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 c) Bahir Dar town issued a Br. 20,000, 5 years, 8% term bonds at the beginning of this year
to finance the construction of Road. The repayment scheme of these bonds shows that
Br. 4000 be transferred per year to Debt service fund from General Fund to be
accumulated for the payment of the bonds at the end of the 5 th year. As a result, the
annual operating transfer was made to debt service fund at the end of the current year,
Current Expenditures by CPF amounted to Br. 5,000, paid in cash.

Prepare the necessary entries for the current year in:

i) General Fund

ii) Debt Service Fund

iii) Capital Project Fund

iv) General Long-Term Debts Account Group

v) General Fixed Assets Account Group