ExpertEasy1 markMultiple Choice
CPA · Question 43 · Area I: Financial Reporting
Under GASB, which fund would account for the activities of a municipal motor pool that charges other city departments for vehicle services on a cost-reimbursement basis?
Under GASB, which fund would account for the activities of a municipal motor pool that charges other city departments for vehicle services on a cost-reimbursement basis?
Answer options:
A.
General Fund
B.
Enterprise Fund
C.
Internal Service Fund
D.
Special Revenue Fund
How to approach this question
Customer = Public -> Enterprise Fund. Customer = Other Gov Depts -> Internal Service Fund.
Full Answer
C.Internal Service Fund✓ Correct
C
Internal Service Funds account for goods/services provided by one department to other departments of the government on a cost-reimbursement basis.
Common mistakes
Confusing Enterprise and Internal Service funds.
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