Which of the Following Statements Is True About Fund Balance

question 33

Multiple Choice

Which of the following statements is true about Fund Balance classifications for the governmental funds?

• A) A restricted fund balance is for monies the governing board has appropriated.
• B) An assigned fund balance has been designated for a specific purpose and is restricted to use for only that purpose.
• C) An unassigned fund balance has no restriction for use of the money and is normally applicable to the general fund.
• D) A committed fund balance has been designated by an outside party for a particular use.
• E) A nonspendable fund balance is designated only for the balance of permanent funds.

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Definitions:

Central Planning

An economic system where the government or a central authority makes all decisions regarding the production and distribution of goods and services.

Capitalism

An economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.

Limited

In a business context, referring to a company where the liability of its members is restricted to what they have invested or guaranteed to the company.

Communist Society

A theoretical economic system characterized by the collective ownership of property and by the organization of labor for the common advantage of all members.