Which of the Following Statements Concerning the Reporting of Internal

question 13

Multiple Choice

Which of the following statements concerning the reporting of internal balances by a government at the end of its fiscal year is ?

• A) The internal balances amounts reported in the balance sheet columns represent activity among governmental funds.
• B) The internal balances amounts reported in the statement of net position columns represent activity between governmental activities and business-type activities.
• C) The internal balances amounts are reported in both the asset and liability sections on the statement of net position.
• D) The internal balances amounts reported represent the difference between interfund transfers in and interfund transfers out.

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Definitions:

Excess Reserves

Funds that banks hold over and above the required reserve ratio set by the central bank, often earning interest.

Checkable Deposits

Bank accounts from which individuals can deposit and withdraw money using checks, ATM transactions, and electronic payments.

Reserve Requirement

The minimum fraction of customer deposits that each bank must hold as reserves, rather than lending out, as mandated by the central bank.

Simple Money Multiplier

A formula that determines the maximum amount of money that banks can create with a given level of reserves.