A Certain Federal Agency Placed an Order for Office Supplies

question 23

Multiple Choice

A certain federal agency placed an order for office supplies at an estimated cost of $14,400. Later in the same fiscal year these supplies were received at an actual cost of $14,800. Assume commitment accounting is not used by this agency. At the time the order is placed, what is the net effect on the budgetary and proprietary track accounts?

• A) Budgetary accounts: $14,400; Proprietary accounts: $14,400.
• B) Budgetary accounts: $14,400; Proprietary accounts: $0.
• C) Budgetary accounts: $14,400; Proprietary accounts: $14,800.
• D) Budgetary accounts: $0; Proprietary accounts: $0.

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Definitions:

Significant Influence

The capacity to affect the financial and operating policies of another entity without having control or full ownership, often through ownership of a sizable percentage of voting shares.

Net Income

The net profit figure for a company, achieved by subtracting all operational costs and tax liabilities from its revenue.

Common Stock

A form of corporate equity ownership, a type of security that represents ownership in a corporation and a claim on a portion of its profits.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee, but not control them, typically associated with ownership of 20-50% of voting stock.