Author Question: Owner's equity includes four types of accounts: Owner's Capital, Revenues, Expenses, and Owner's ... (Read 137 times)

bio_gurl · **on:** Jul 5, 2018

Owner's equity includes four types of accounts: Owner's Capital, Revenues, Expenses, and Owner's Drawing.
a. True
b. False
Indicate whether the statement is true or false

Question 2

In the two-worksheet approach, what type of adjustment will be necessary for interest expenditure/expense on the operating statement conversion worksheet?

A. No adjustment is necessary for interest expenditure/expense. The amount of interest expenditure on the governmental fund financial statements is the same amount that will be reported as interest expense in the government-wide statements.
B. Interest on long-term debt that has been incurred but not paid will need to be added to the interest expenditure reported on the governmental funds balance sheet.
C. Interest paid this year that is attributable to the previous year accrual for long-term debt will need to be deducted from interest expenditure reported on the governmental funds balance sheet.
D. An adjustment to the interest expenditure reported on the governmental funds operating statement will be necessary for the net change in accrued interest payable on long-term debt from the beginning of the year to the end of the year.