How Should Financial Information for Internal Service Funds Be Reported

question 42

Multiple Choice

How should financial information for internal service funds be reported in the government-wide financial statements?

• A) As part of governmental activities.
• B) As part of business-type activities.
• C) Amounts allocated proportionately between governmental and business-type activities.
• D) Usually as part of governmental activities, unless the internal service fund predominantly serves one or more enterprise funds.

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Definitions:

Drawer-payor Bank

Refers to the bank upon which a check is drawn and is responsible for paying the check when it is presented.

Banking Day

A business day during which financial institutions are open for conducting banking transactions.

Bank Statement

A bank statement is a summary of financial transactions that occurred over a certain period of time in a bank account, provided regularly by the bank to the account holder.

Transactions

The act of conducting business or commercial activities, often involving the exchange of goods, services, or funds.