Which of the Following Statements Regarding the Accounting for Investments

question 46

Multiple Choice

Which of the following statements regarding the accounting for investments in governmental funds is false?

• A) Interest receivable should be accrued as it is earned.
• B) Interest revenue should be recognized on a cash basis.
• C) Interest revenue is recognized no later than when it meets the availability criteria.
• D) Decreases in the fair market value of equity securities with readily determinable fair values result in a decrease in investment income.

---

Definitions:

P-chart

A type of control chart used in statistical quality control that monitors the proportion of defective items in a process over time.