Which of the Following Is True Regarding Modified Accrual Accounting

question 116

Multiple Choice

Which of the following is true regarding modified accrual accounting?

• A) Expenditures for claims and judgments, compensated absences, and special termination benefits should be recognized whether or not the liabilities are to be paid with available resources.
• B) Expenditures for services used by General Fund departments should be recognized when those services are received, regardless of whether or not resources are available in the fund.
• C) Both of the above are true.
• D) Neither of the above is true.

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Definitions:

Appointing Officers

The act of designating individuals to hold specific positions or offices within an organization or institution.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, often with dividends that are paid out before those of common stockholders.

Dividends

Payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.

Company Liquidates

The process in which a company ceases operations and sells off its assets to pay creditors.