GASB 34 Specifies Two Criteria for Determining Major Governmental Funds

question 50

Multiple Choice

GASB 34 specifies two criteria for determining major governmental funds to be reported separately in the Governmental Fund Balance Sheet and Statement of Revenues,Expenditures,and Changes in Fund Balances.To be considered a major governmental fund,a fund must:

• A) meet at least one criterion.
• B) be the general fund or meet at least one criterion.
• C) be the general fund or meet two criteria.
• D) either A or C

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Definitions:

Fixed Overhead

Costs that do not change with the level of production or business activity, such as rent, salaries of permanent staff, and insurance.

Volume Variance

The difference between the budgeted and actual volume of units sold or produced, impacting direct materials, direct labor, and overhead costs.

Fixed Overhead

The regular, recurring expenses that are not affected by the level of business activity, such as rent, salaries, and insurance.

Budget Variance

Budget Variance is the difference between what was budgeted or planned for a particular period and what was actually spent or received.