Which of the Following Statements Is Not Correct with Respect

question 33

Multiple Choice

Which of the following statements is not correct with respect to Agency Funds?

• A) Agency funds use modified accrual accounting
• B) Assets accounted for in an agency fund belong to the party or parties for which the government acts as agent.
• C) Assets are offset by an equal amount of liabilities.
• D) Assets and liabilities are recognized at the time the government becomes responsible for the assets.

---

Definitions:

Long-Term Debt

Borrowings and financial obligations that are due for repayment in more than one year, indicating a company's leverage.

Fixed Assets Management

Fixed assets management involves the accounting and management practices related to the selection, maintenance, inspection, and disposal of fixed assets to maximize their efficiency and value to the business.

Cash Conversion

The process of turning physical goods, services, or other assets into cash, often measuring the efficiency of a company in generating revenue.

Credit Policies

Guidelines set by businesses to determine the terms and conditions for extending credit to customers.