Internal Service Funds Are Treated as Governmental Activities in the Government-Wide

question 74

True/False

Internal Service funds are treated as governmental activities in the government-wide statements if the principal customers are other departments within the General Fund.

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Definitions:

Fixed-rate Debt

A type of debt instrument where the interest rate remains constant throughout the life of the borrowing.

Floating-rate Debt

A form of borrowing where the interest rate fluctuates over time based on a benchmark or index rate.

Derivative Instrument

A financial contract whose value is derived from the performance of underlying assets, indices, or interest rates.

Forward Contract

A customized contract between two parties to buy or sell an asset at a specified price on a future date.