GASB Statement 34 Requires Enterprise Funds to Be Used Under

question 82

Multiple Choice

GASB Statement 34 requires enterprise funds to be used under which of the following circumstances?

• A) When debt is backed by the full faith and credit of the government issuing it.
• B) When the legal requirement exists that the cost of providing services for an activity, including capital costs, be recovered through fees or charges.
• C) When a government is restricted by grant covenants to cover the cost of providing services for an activity.
• D) None of the above circumstances would require the use of an enterprise fund.

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Definitions:

Land Resources

Natural resources encompassing geographical territories and the natural materials available within them, such as water, minerals, and fertile land used for agriculture.

Money

Anything that is generally accepted in exchange for goods and services.

Capital

Assets used for the production of goods and services, including machinery, buildings, and equipment.

Economics

The social science that studies how individuals, governments, firms, and nations make choices on allocating scarce resources to satisfy their unlimited wants.