Certain Fiscal Practices of Governments Promote Interperiod Equity While Others

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The Answer is a.Promotes interperiod equity.Because the bonds are required to be repaid over the life of the capital assets, the cost of those assets is allocated to the periods over which taxpayers benefit from the use of the assets.
b.Undermines interperiod equity.The employee benefits costs-pension benefits-are paid by an entirely different generation of taxpayers-long after the employees earned the benefits by providing services.
c.Promotes interperiod equity.Although not particularly material, supplies do not benefit taxpayers until they are used to provide services.Reporting these as expenditures when purchased reports the cost in a different period from when the benefit is provided.
d.Undermines interperiod equity.Using debt to finance operating costs spreads the cost of providing services provided in a single period over the entire term of the long-term debt.Interest costs on the debt amplify the problem.
e.Promotes interperiod equity.Again, while possibly immaterial, reporting the cost of providing services-in the form of wages and salaries-in the period in which services were provided promotes interperiod equity.

Certain Fiscal Practices of Governments Promote Interperiod Equity While Others

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