Which of the Following Is True Regarding the Proprietary Fund

question 32

Multiple Choice

Which of the following is true regarding the proprietary fund financial statements?

• A) Statements include the Statement of Net Position, Statement of Revenues, Expenses, and Changes in Fund Net Position, and Statement of Cash Flows.
• B) Normally, a reconciliation is required between the proprietary fund financial statements and the business-type activities column in the government-wide financial statements.
• C) The Statement of Net Position reflects equity as contributed equity and retained earnings.
• D) The Statement of Cash Flows may be prepared using either the direct or indirect methods.

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Definitions:

Restrictive Fiscal Policy

Fiscal measures implemented by a government to reduce its spending and/or increase taxes with the aim of slowing down an overheating economy.

Economic Plunge

A sudden and sharp decline in economic activity, often characterized by a decrease in GDP, investment, and employment.

Tax Rates

The percentages at which income, property, and sales are taxed by governments.

Money Supply

The total amount of monetary assets available in an economy at a specific time, including cash, bank deposits, and other liquid assets.