An Internal Service Fund Had Investments with an Original Cost

question 37

Multiple Choice

An Internal Service Fund had investments with an original cost of $100,000. As of the end of the fiscal year, the fair market value on these investments was $85,000. The Internal Service Fund would

• A) Report expenses of $15,000.
• B) Report a reduction of revenue of $15,000.
• C) Not adjust the value of the investments reported on the balance sheet.
• D) Report a loss on investments of $15,000.

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Definitions:

Poisson Model

A statistical model used to predict the number of events occurring within a fixed interval of time or space, assuming events occur with a known constant rate and independently of the time since the last event.

Exponential Random Variable

A type of continuous random variable often used to model the time between events in a process with a constant rate.

Exponential Distribution

A probability distribution that describes the time between events in a Poisson process, modeling the occurrence of events over time.

Density Function

A mathematical expression that represents the distribution probability of a continuous random variable.