Which of the Following Statements Is Correct Concerning Interest Expenditures

question 5

Multiple Choice

Which of the following statements is correct concerning interest expenditures incurred during the period of construction of capital projects?

• A) Interest expenditures may not be capitalized as part of the cost of general capital assets reported in governmental activities.
• B) Interest expenditures may be capitalized as part of the cost of general capital assets reported in the governmental activities accounts at the government-wide level.
• C) Interest expenditures must be capitalized as part of the cost of general capital assets reported in the capital projects fund.
• D) The capitalization of interest expenditures as part of the cost of general capital assets reported in the capital projects fund is optional.

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Definitions:

Pearson Correlation

A measure of the linear correlation between two variables X and Y, giving a value between +1 and -1 inclusive, where 1 is total positive linear correlation, 0 is no linear correlation, and -1 is total negative linear correlation.

Critical Values

Thresholds determined by the significance level of a test, marking the boundary within which the null hypothesis is accepted or rejected.

Pearson Correlation

A measure of the linear relationship between two continuous variables, ranging from -1 to 1, where 1 means a perfect positive correlation.

Pearson Correlation

Another name for Pearson r, indicating the degree of linear relationship between two variables.