Which of the Following Actions Is Not Required to Convert

question 44

Multiple Choice

Which of the following actions is not required to convert data from the governmental fund financial statements to enable preparation of the government-wide financial statements?

• A) Adding annual depreciation expense proportionately to functional expense categories.
• B) Eliminating interfund payables and receivables between governmental funds.
• C) Aggregating fund information.
• D) Eliminating receivables and payables between governmental and enterprise funds.

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Definitions:

Pretax Income

The income that a company earns before tax expenses are deducted, often referred to as earnings before tax (EBT).

Understatement

The act of presenting financial figures that are lower than the actual numbers, either intentionally or unintentionally.

LIFO Reserve

The difference in inventory valuation between the Last In, First Out (LIFO) method and another inventory accounting method, such as FIFO (First In, First Out).

FIFO Amounts

The value of inventory computed under the First-In, First-Out method, assuming the items purchased or manufactured first are sold first.