CURRENT FUND EXAM

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bltaft13
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289557
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CURRENT FUND EXAM
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2014-11-24 15:52:58
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CURRENT FUND EXAM
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Current fund Exam Questions
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  1. Under which of the following conditions would a municipality qualify for self-examination of their budget
    • -Total outstanding indebtedness of the previous fiscal year was 3.2%
    • -the tax collection rate was 90.5%
    • -the municipality conducted an accelerated tax sale for the first time last year
    • ANSWER IS ALL OF THE ABOVE
  2. which phrase below best describes a Chapter 159
    an insertion of a special item of revenue and appropriation in the budget
  3. which of the following budget appropriations is a municipality NOT permitted to transfer FROM
    • Recycling Tax
    • Capital Improvement Fund
  4. Receipts from Delinquent Taxes revenue is limited to the amount of revenue realized in the previous year
    False
  5. Which of the following is not a book of original entry
    General Ledger

    • Cash Receipts Journal
    • Cash Disbursements Journal
    • General Journal
    • Payroll Journal
  6. When is the Annual Debt Statement Due
    January 31
  7. When is the Annual Audit Due for a Calendar year Municipality
    June 30
  8. The supplemental Debt Statement is due upon the adoption of a bond ordinance
    False
  9. Which of the following is NOT a common municipal fund
    Industrial Commission Fund


    • Current Fund
    • Open Space Trust Fund
    • General Capital Fund
    • Trust Assessment Fund
  10. Which of the following accounts is described as "perpetual-Not closed out annually
    Prepaid Taxes
  11. Which of the following activities would NOT create a deferred charge
    Prepaid taxes not applied to Taxes  Receivable in full
  12. Which of the following best describes NJ municipal Accounting
    revenue is realized on a cash basis
  13. Which of the following Technical Accounting Directives mandates use of a general ledger for all funds
    Technical Accounting Directive 85-3
  14. Which of the following procedures is a municipality required to follow under Technical Accounting Directive 85-2, fixed assets accounting
    Have a subsidiary ledger of detailed records of fixed assets
  15. Which of the following is not an effective internal control procedure
    The CFO stamps three signatures on each Township check that is issued
  16. Grant disbursements are made from the Current Fund
    False
  17. In which of the following circumstances would a municipality be permitted to anticipate more miscellaneous revenue than what was realized in the prior year
    None of the above
  18. Which of the following operational results would bring about the greatest increase to Fund Balance
    Appropriation Reserves lapse of $153,000
  19. Unexpended debt service must be canceled by resolution
    false
  20. Unexpended current year budget appropriations can be canceled in the current year if authorized by resolution before year end
    True
  21. Which of the following is NOT a proper disposition for Tax Overpayment
    Apply the overpayment to Amount to be Raised by Taxation Revenue
  22. Township Committee is formulating their budget and wants to drop the proposed tax increase from 3c to 2c.  How much in appropriations does the Township need to cut in order to accomplish this? The Township of Anywhere has a NVT of 24,000,000
    24,000
  23. What is the overall purpose of a Cash Management Plan
    to derive the greatest possible productivity from idle funds
  24. Which of the following is not a permitted investment for municipal funds
    Derivative instruments maintained in the United States
  25. Which of the following accounts carries a debit balance
    due from animal control Fund
  26. Municipalities must set up a liability for the school and county portion of added and omitted taxes
    false
  27. What is the balance in the current year appropriations account after all closing entries have been made
    Zero
  28. Which of the following operational results would bring about the LARGEST increase to surplus
    Construction Code Revenue budgeted at $15,000 amount realized was $60,000
  29. Which of the following receivable on the current fund balance sheet does NOT have an offsetting reserve
    Due from the State of NJ for Senior Citizen & Veteran Deductions
  30. Which of the following accounts would be Debited upon posting the annual adopted budget
    Amount to be Raised by Taxation
  31. New Jersey Municipalities utilize which basis of accounting
    Modified Accrual
  32. A New Jersey municipality realizes revenue when it is
    Earned, Measurable and Available
  33. Local Budget Law
    NJSA 40A:4
  34. Local Public Contracts Law
    NJSA 40A:11
  35. The detail of each block and lot that owes a balance to the municipality would be disclosed on the general ledger
    False
  36. Each major category of anticipated revenue (4major anticipated revenues) has an individual account on the general ledger
    True
  37. The four major categories of anticipated revenue are
    • Surplus/Fund balance
    • Miscellaneous revenue anticipated
    • Delinquent Taxes
    • Amount to be Raised by Taxation
  38. each legal line item (appropriation) in the budget has its own account on the general ledger
    false
  39. Which of the following general ledger accounts would NOT have a detailed subsidiary ledger to back it up
    Amount to be Raised by Taxation
  40. Which of the following general ledger accounts is NOT perpetual
    Miscellaneous Revenue Not Anticipated
  41. The threshold for adding fixed assets to the fixed assets ledger is $5,000 however, if a municipality has an internal policy that sets a lower threshold, that lower threshold may be utilized
    True
  42. RUT cannot be calculated until actual tax levies form the other taxing entities are obtained
    False
  43. Which of the following is a municipal appropriation
    Reserve for Uncollected Taxes
  44. A municipality should never cut a check and charge it to the Reserve for Uncollected Taxes appropriation in a given year
    True
  45. Grants are spent from the federal & State grant Fund
    True
  46. What is a general rule of thumb regarding the use of surplus as revenue in a municipal/county budget
    Don't anticipate more than you plan to regenerate
  47. What is the difference between Surplus and Fund Balance
    There is no difference between Surplus and Fund Balance-the two terms are used interchangeably
  48. A municipality overexpended the Education & Training sub account within the public works O/E legal line item.  The legal line item as a whole was not overexpended.  This municipality needs to anticipate the amount of the Overexpenditure as a deferred charge appropriation in the subsequent year's budget
    False
  49. Which of the following does not represent property taxes due from a homeowner
    prepaid taxes
  50. When an outside lienholder pays the taxes for a property at the annual tax sale, that property enters municipal lien status
    False
  51. Which entity funds the $250 senior citizen and veteran deductions awarded to qualifying residents
    State of New Jersey
  52. The Appropriation Reserves G/L account carries a ________Balance
    Credit
  53. Open encumbrances against the current year's budget are called
    Reserve for Encumbrances
  54. Which of the following account carries a debit balance
    Deferred Charge - Special Emergency

    • Not
    • Prepaid Taxes
    • School taxes payable
    • due to general capital
  55. A resident prepays their 2015 taxes in December 2014.  In which year will the realization of revenue for this payment be realized.
    2015
  56. Tax Overpayments is a
    Liability
  57. If an Overexpenditure exceeds 3% of operating appropriations, it may be raised over a three year period
    False
  58. a five-year special emergency was originated in the year 2012.  In which budget year will the last installment take place
    2017
  59. Which of the following appropriations gets charged off annually
    all of the above

    • Grants
    • Reserve for Uncollected taxes
    • deferred charges
  60. If the CFO forgets to disburse the capital Improvement fund appropriation to the general capital fund in the year its budgeted an interfund to the general capital fund must be set up for the amount of the appropriation
    true
  61. the appropriation reserves G/L account starts and ends with a 0
    False
  62. CMFO
    Certified Municipal Finance OFficer
  63. How is the maximum amount of delinquent taxes that may be anticipated determined
    The percentage of delinquent taxes collected in the prior year applied to the year end outstanding delinquent tax balance
  64. When should the Certification of Availability of Funds be signed by the Chief Financial Officer
    Prior to the award of a contract by the governing body
  65. For a given year budget transfers between appropriation reserves are permitted
    During the first three months of the year
  66. Municipalities in NJ may authorize and encumber funds through;
    All of the Above

    • The adoption of the municipal budget
    • the adoption of a capital bond ordinance
    • the adoption of a dedicated trust fund
  67. Resolutions authorizing the transfer of a appropriations requires what vote of the full membership of the governing body
    2/3 of full membership
  68. The Local Fiscal Affairs Law permits the establishment of petty cash funds.  The person with whom the authority rests for approval and/or disapproval of a petty cash fund prior to activation is
    The Director of the Division of Local Government Services
  69. Which of following terms is described as: An obligation of funds by a local unit arising from the issuance of a numerically controlled purchase order or contract, which results in the reduction of amount remaining for spending
    Encumbrance
  70. Every audit required by local fiscal affairs law NJSA 40A:5-9 is required to be performed by an accountant or auditor who holds an active license as
    Registered Municipal Accountant
  71. What is the purpose of a budge
    • Management Tool
    • Economic Tool
    • Financial Control
  72. The reserve for Uncollected Taxes is best described as
    Non-Spending appropriation
  73. Additions to the Budget after adoption are fenerally referred to as
    Chapter 159 amendment
  74. In 2000 the DLGS adopted a document referred to as FCOA to improve financial reporting among local units.  What does FCOA stand for
    Flexible Chart of Accounts
  75. The four classifications of revenue as stipulated by the Local Budget Law 40A:4-23 are
    • Surplus Anticipated
    • Miscellaneous Revenue
    • Receipt from Delinquent Taxes
    • Amount to be raised BY Taxation
  76. The NJ Administrative Code 5:34-5.2 outlines the procedure for the certification of the availability of funds.  It is required that no resolution authorizing the entering into any contract shall be enacted unless it shall recite that such a certification showing availability of funds has been provided.  In addition it requires
    The resolution specify the exact budgetary line item appropriation or ordinance to be charged
  77. An equation generally used to summarize the content of a financial statement is
    Assets-Liabilities = Equity
  78. A credit to a revenue account
    increases revenues
  79. In general budgets represent
    The expected or planned results of revenue and expense activities of an organization
  80. The Trial Balance:
    Lists all accounts in the General Ledger with their balances to date
  81. Which of the following is NOT an anticipated revenue in the budget
    Miscellaneous Revenue not Anticipated
  82. Municipalities and Counties are not allowed to make transfers from budget line items that are excluded from the CAP
    True
  83. The account Reserve for Current Year Taxes Receivable is which type of Account
    Liability
  84. To which account are revenues from current year tax collections realized
    Amount to be Raised by Taxation
  85. Which of the following transaction descriptions would result in a debit to Current Year Taxes Receivable
    Record a senior/vet disallowance
  86. Which of the following is not a possible disposition of a tax overpayment
    Close the overpayment to appropriation Reserves
  87. Which of the following accounts is debited when recording the entry to set up the liabilities due to the other taxing entities
    Amount to be Raised by taxation
  88. There is a lot of non cash activity running through the Amount to be Raised by taxation revenue account.  Which of the following transactions does not run through this account
    • None-they all run through Amount to be Raised by Taxation
    • Realizing revenue from current year taxes
    • Record the added/omitted levy due to the county
    • Posting the Budget
    • Charge off Reserve for Uncollected Taxes
  89. Why/how would a property end up in municipal lien status
    No outside lienholders bid on the lien
  90. Interest and Costs accrued at the tax sale represents a non-cash transaction that must be recorded to the general ledger
    True
  91. Realizing tax revenue results in a credit to a revenue account.  What account is debited when realizing tax revenue
    a Reserve for receivable
  92. A tax appeal of Current year taxes is treated as a canceled tax
    True
  93. Reserve for Current Year Taxes Receivable and Reserve for Delinquent Taxes Receivable must equal each other at all times thoughout the year
    False
  94. Current Year Taxes Receivable starts and ends with a zero
    True
  95. Prepaid Taxes Starts and ends with a zero
    False
  96. Reserve for Current Year Taxes Receivable starts and ends with a zero
    True
  97. What is the entry to set up an overpayment
    • Debit CY Taxes Receivable
    •              Credit Overpayments
  98. There is a non-cash transaction transferring (a)Delinquent Taxes Receivable to TTL; and (b) Current Taxes Receivable to TTL.  Both of these transactions can be made at the time of the tax sale
    False

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