A governmental entity operates landfill. Companies look to generate positive cash flow. The purchase or sale of a fixed asset like property, plant, or equipment would be an investing activity. Cash flow from investing is listed on a company's cash flow statement. The cash flow statement reports the amount of cash and cash equivalents leaving and entering a company. Cash advance to borrowers. Which of the following is the best rationale/justification for reporting the business-type, Laws or regulations require that the activity's costs of providing services be recovered by. A cash flow statement is a financial statement that provides aggregate data regarding all cash inflows and outflows a company receives. Overall, the cash flow statement provides an account of the cash used in operations, including... Cash Flow from Investing… 62, as well as any FASB pronouncement issued since the issuance of Statement No. Of this amount, $75,000 was intended for catastrophes. What basis of accounting do enterprise and internal service funds use? On its government wide statements this amount would be recorded as an asset in the, In its first year of operation, a self-insurance internal service fund billed the general fund $500,000 for premiums. Operating activities are those that pertain to a company's core business activities, such as manufacturing, distributing, marketing and selling a service. It would have separate categories for cash flows from non-capital financing activities and cash flows from capital and related financing activities, A government decided to account for a vehicle repair service in an internal service fund rather than its general fund. Which of the following would not be included in the computation of the amount to be recognized as a landfill closure expense? Statement of changes in fund net position, A government need not necessarily account for an activity in an enterprise fund even though it, Charges fees for an activity and those fees are material in amount, Government business-type activities must apply, All FASB pronouncements incorporated into GASB Statement No. In the Statement of Net Assets, the net assets of a proprietary fund should be displayed in, Unrestricted Net Assets; Restricted Net Assets; Invested in Capital Assets, Net of Related, A Statement of Revenues, Expenses, and Changes in Fund Net Assets should include which, Nonoperating revenues and expenses, Capital Contributions and Other Changes in Net, In which of the following circumstances must an enterprise fund be used to account for the, To finance the acquisition of plant facilities, a newly created electric utility issues. Financial statements are written records that convey the business activities and the financial performance of a company. Generate revenues sufficient to cover the full costs of providing services. D. Cash … Cash flows from investing activities do not include: A. Payment for the purchase of equipment. Financial statements include the balance sheet, income statement, and cash flow statement. b. Which of the following is a valid argument for separate accounting principles for proprietary, The measurement focus on all economic resources is more consistent with the GASB's, Which of the following is a key reason for using business-type accounting to account for, Which of the following is NOT a budget typically prepared for an activity accounted for in a, A governmental entity reports its utility services provided to the citizens in a proprietary. As a consequence of these transactions, the insurance fund would report on its statement of net position, A city makes an interest payment of $6 million on its utility fund revenue bonds that were issued to finance new sewer lines. Which of the following projects is a state university most likely to finance with revenue bonds rather than general obligation bonds? In a year in which the repair service acquired an unusually large amount of repair equipment, the amount recorded as an expense in the internal service fund would be, Less than if the repair service were accounted for in the general fund, A school district's internal service fund has cash on hand at year-end of $2 million. 34 mandates that governments report their cash flows from operations, The FASB mandates entities report their cash flows from operations using the direct method, Governments generally do not have to get formal legislative approval for enterprise fund, In accounting for closure and postclosure landfill costs in an enterprise fund, a government, The revenues of an internal service fund are the expenditures and expenses of other funds of, The proprietary fund operating statement includes ALL changes in net assets including, The appropriate measurement focus for the business-type activities of the City of Rockford is. Which of the following is not a proprietary fund? c. Cash proceeds from borrowing. In the Proprietary fund statements, without any interfund eliminations. Cash flow from investing is listed on a company's cash flow statement. In the city's government-wide statement of net position which would be correct? Outflow: purchase of marketable securities 3. a) In a separate restricted asset category on the statement of net assets. Outbound cash flow is any money a company or individual must pay out when conducting a transaction with another party. Let’s take a closer look at each of these items for Amazon.Amazon’s investing activities include: 1. In the Landfill Enterprise Fund financial statements, Cash received from the sale of bonds that must, based on the debt covenant, be spent only, When a governmental enterprise fund has restricted assets on its balance sheet, which of the, The total of the restricted assets less related liabilities will be equal to the "Restricted Net, Any internal service fund balances that are not eliminated in the consolidation process should, On the fund financial statements, internal service activities should be presented. The payable and the corresponding receivable would be eliminated in the consolidation process and thus would not be reported. In the city's government wide statements, which would be correct? Cash flow from investing activities includes any inflows or outflows of cash from a company's long-term investments. Transactions That Cause Positive Cash Flow From Financing Activities Issuing equity or stock, which is sold to investors Borrowing debt from a creditor or bank Issuing bonds, which is debt that investors purchase The appropriate basis of accounting for the proprietary funds of a governmental entity is, Which of the following is a valid reason for governmental entities to engage in business-type. Free cash flow to the firm (FCFF) represents the amount of cash flow from operations available for distribution after certain expenses are paid.