A Governmental Entity Reports Its Utility Services Provided to the Citizens

question 8

Multiple Choice

A governmental entity reports its utility services provided to the citizens in a proprietary fund.Which of the following best represents an acceptable election of accounting standards for the proprietary fund? Unless the FASB pronouncement conflicts with or contradicts a GASB pronouncement, a propriety fund must adhere to

• A)All FASB pronouncements.
• B)All FASB pronouncements issued prior to November 30, 1989, as well as any post-November 30, 1989 pronouncements specifically adopted by GASB.
• C)It must apply only GASB standards.
• D)It may elect either a or b.

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Definitions:

Painting Department

A specialized division within a manufacturing facility responsible for the application of paint to products.

Weighted-Average Method

An accounting technique to assign costs to inventory and cost of goods sold, based on the weighted average of the costs of similar goods.

Equivalent Units

A concept in cost accounting used to apportion costs to partially completed units of product, allowing for the calculation of per-unit costs in process costing environments.

Molding Department

A specialized section within a manufacturing plant where raw materials are shaped into components through various molding processes.