Why does Gleim and Government make me feel like I am going crazy and am insane… can anyone explain to me the difference in these two questions? I.e. why does one say to account for the creation of a private-purpose trust in a specific revenue fund while the other one says you don't?????
A special revenue fund is used to account for the proceeds of specific revenue sources used
A. To Create a Private-Puropse Trust- Yes; For Major Capital Projects-Yes
B. To Create a Private-Puropse Trust- No For Major Capital Projects-No
C. To Create a Private-Puropse Trust- Yes; For Major Capital Projects-No
D. To Create a Private-Puropse Trust- No; For Major Capital Projects-Yes
Answer (B) is correct.
Special revenue funds account for restricted or committed proceeds of specific revenue sources. Expenditure must be for a specified purpose (but not debt service or a capital project). Also, a special revenue fund is not used for the resources of a trust benefiting specific individuals, private organizations, or other governments. A private-purpose trust fund is a fiduciary fund, other than a pension (or other employee benefit) trust fund or an investment trust fund, that reports a trust arrangement for the benefit of individuals, private organizations, or other governments.
The following financial resources were among those held by Seco City:
For acquisition of major capital facilities $6,000,000
To create a public-purpose trust 2,000,000
What amount should be accounted for in Seco’s special revenue funds?
A. $8,000,000
B. $6,000,000
C. $0
D. $2,000,000
Answer (D) is correct.
A capital projects fund is used to account for financial resources restricted, committed, or assigned to expenditures for capital outlays, including the acquisition or construction of capital facilities and other capital assets. Given that the $6 million amount is to be used for the acquisition of major capital facilities, it should be accounted for in a capital projects fund. A special revenue fund is used to account for the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects. Thus, the $2 million amount to be used to create a public-purpose trust should be accounted for in a special revenue fund.
and they ask me why I drink...
FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2
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