Encumbrances and Expenditures Both Reduce Total Fund Balances of State

question 5

True/False

Encumbrances and expenditures both reduce total fund balances of state and local governments.

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Definitions:

Accounts Payable

Liabilities to creditors that must be paid within a short period, usually less than a year.

Operating Activities

Activities that constitute the primary or main activities of an organization, including production, sales, and delivery of services.

Cash Dividend

A cash distribution given to shareholders from the company's earnings.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and stockholders' equity at a specific point in time.