Multiple choice [Based on AICPA] 1. The billings for transportation services provided to other governmental units are recorded by the internal service fund as: a Interfund exchanges b Intergovernmental transfers c Transportation appropriations d Operating revenues 2. Which of the following transactions would not be allowed in an internal service fund? a The purchase of capital items b Borrowing from another fund c Transfers from other funds d None of the above 3. Initial financing for internal service fund activities may be obtained from a Advances from another fund b Transfers from another fund c Transfer of related materials held by governmental departments d All of the above 4. Cariton City serves as a collecting agency for the local independent school district and for a local water district. For this purpose. Cartton has created a single agency fund and charges the other entities a fee of 1 percent of the gross amounts collected. (The service fee is treated as a general fund revenue.) During the latest fiscal year, a gross amount of $268,000 was collected for the independent school district and $80,000 for the water district. As a consequence of the forgoing, Cariton's general fund should: a Recognize receipts of $348,000 b Recognize receipts of $344,520 c Record revenue of $3,480 d Record encumbrances of $344,520 5. Through an internal service fund, Floyd County operates a centralized data processing center to provide services to Floyd's other departments. In 2012, this internal service fund billed Floyd's parks and recreation fund $75,000 for data processing services. What account should Floyd's internal service fund credit to record this $75,000 billing to the parks and recreation fund? a Operating revenues b Interfund exchanges c Intergovernmental transfers d Data processing department expenses.

1. Multiple choice [Based on AICPA] 1. The billings for transportation services provided to other
governmental units are recorded by the internal service fund as: a Interfund exchanges b
Intergovernmental transfers c Transportation appropriations d Operating revenues 2. Which of
the following transactions would not be allowed in an internal service fund? a The purchase of
capital items b Borrowing from another fund c Transfers from other funds d None of the above 3.
Initial financing for internal service fund activities may be obtained from a Advances from
another fund b Transfers from another fund c Transfer of related materials held by governmental
departments d All of the above 4. Cariton City serves as a collecting agency for the local
independent school district and for a local water district. For this purpose. Cartton has created a
single agency fund and charges the other entities a fee of 1 percent of the gross amounts
collected. (The service fee is treated as a general fund revenue.) During the latest fiscal year, a
gross amount of $268,000 was collected for the independent school district and $80,000 for the
water district. As a consequence of the forgoing, Cariton's general fund should: a Recognize
receipts of $348,000 b Recognize receipts of $344,520 c Record revenue of $3,480 d Record
encumbrances of $344,520 5. Through an internal service fund, Floyd County operates a
centralized data processing center to provide services to Floyd's other departments. In 2012, this
internal service fund billed Floyd's parks and recreation fund $75,000 for data processing
services. What account should Floyd's internal service fund credit to record this $75,000 billing
to the parks and recreation fund? a Operating revenues b Interfund exchanges c
Intergovernmental transfers d Data processing department expenses