ExpertMedium1 markMultiple Choice
CPA · Question 31 · Area I: Financial Reporting
Government-Wide Financial Statements are prepared using which measurement focus and basis of accounting?
Government-Wide Financial Statements are prepared using which measurement focus and basis of accounting?
Answer options:
A.
Current Financial Resources; Modified Accrual
B.
Economic Resources; Modified Accrual
C.
Current Financial Resources; Accrual
D.
Economic Resources; Accrual
How to approach this question
Government-Wide = Economic Resources / Accrual (Long-term view). <br/>Governmental Funds = Current Financial Resources / Modified Accrual (Short-term budget view).
Full Answer
D.Economic Resources; Accrual✓ Correct
Government-Wide FS (Statement of Net Position, Statement of Activities) use the Economic Resources measurement focus and the Accrual basis of accounting.
Common mistakes
Confusing Government-Wide with Governmental Funds.
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