Use the Following Information to Determine Whether the Development Special

question 45

Multiple Choice

Use the following information to determine whether the Development Special Revenue and the Debt Service Funds should be reported as major funds based on asset amounts provided. $\begin{array}{llr}\text { Development Special Revenue Fund Assets } & \$ & 740,000 \\ \text { Debt Service Fund Assets } & \$ & 150,000 \\ \text { Total Governmental Fund Assets } & \$ &7,500,000 \\ \text { Total Governmental Fund and Enterprise Fund Assets } & \$ &8,750,000\end{array}$
 

• A) The Development Special Revenue Fund should be reported as major.
• B) The Debt Service Fund should be reported as major.
• C) Both the Development Special Revenue Fund and the Debt Service Fund should be reported as major.
• D) Neither the Development Special Revenue Fund nor the Debt Service Fund should be reported as major.

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Definitions:

Trade Discount

A reduction from the list price given by a seller to a buyer, often based on the volume of the transaction or to incentivize early payment.

Bank

A financial institution licensed to receive deposits and make loans, it may also provide financial services such as wealth management, currency exchange, and safe deposit boxes.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenues, expenses, and profits or losses.

Balance Sheet

An overview document that itemizes a business’s resources, debts, and owner’s equity at a particular date, giving a concise view of its fiscal status.