The Financial Statements of a Proprietary Fund Are Similar to Those

question 46

Multiple Choice

The financial statements of a proprietary fund are similar to those of a business enterprise except for

• A)proprietary funds do not report income taxes on the operating statement.
• B)proprietary funds do not have paid-in capital or capital stock.
• C)proprietary funds use modified accrual accounting.
• D)proprietary funds may have account titles such as due from general fund.

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Definitions:

Inflation

The degree of uptick in the universal valuation of goods and services, weakening purchase potency.

Natural Rate

The unemployment rate at which the economy operates when it is at full employment, reflecting the long-term levels of unemployment due to structural factors in the labor market.

Unemployment Rate

A measure representing the percentage of the labor force that is jobless and actively seeking employment.

Inflation Expectations

The rate at which people anticipate prices will increase in the future, which can influence current economic behavior and monetary policy.