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9. Which statement is not correct?

MULTIPLE CHOICE

a. Governmental funds account for expenditures of financial resources rather than matching revenues and expenses.

b. The Encumbrances Outstanding account should be reversed and closed at the end of a fiscal year.

c. Revenues from licenses and permit fees are recognized when received in cash if using the modified accrual basis of accounting for governmental funds.

d. A fund is an independent accounting entity composed of cash and other financial resources, segregated for the purpose of carrying on specific activities and objectives.

e. Commitments for purchase orders are recorded as expenses.

10. Proprietary funds are:

MULTIPLE CHOICE

a. Funds used to account for the activities of a government that are carried out primarily to provide services to citizens.

b. Funds used to account for a government's ongoing activities that are similar to those operated by for-profit organizations.

c. Funds used to account for monies held by the government in a trustee or agency capacity.

d. Funds used to account for all financial resources except those required to be accounted for in another fund.

e. Funds used to account for resources that are restricted or committed for a specific purpose other than debt payments or capital projects.

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