Which of the Following Is NOT True About Internal Service

question 12

Multiple Choice

Which of the following is NOT true about internal service funds as reported in the fund financial statements?

• A) Costs reported by internal service funds are reported twice within the same set of financial statements.
• B) Billing rates must be set to cover the full cost of providing the goods or services.
• C) Depreciation can be charged to governmental funds through the billing rates established by the internal service fund.
• D) Deficits or surpluses in the general fund can be transferred to the internal service fund by adjusting the billing rates.

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Definitions:

Official Rules

The set of formal regulations and guidelines that govern a particular activity, organization, or event.

Enforced

Implementation or execution of rules, regulations, or decisions in order to compel obedience or compliance.

Manifestation

The demonstration or display of the existence or presence of something.

Culture

The shared values, beliefs, norms, and practices that shape the environment and behavior of individuals within an organization or society.