1. The following are key terms in Chapter 7 that relateaccounting for the business-type activities of state and localgovernments:
A. Allowance for Funds Used during Construction
B. Revenue bonds
C. Utility plant acquisition adjustment
D. Regulatory accounting principles
E. Original cost
F. Historical cost
G. General obligation bonds
For each of the following definitions, indicate the key term fromthe list above that best matches by placing the appropriate letterin the blank space next to the definition.
_____ 1. In utility accounting, the net cost for the period ofconstruction of borrowed funds used for construction purposes and areasonable rate on other funds so used
_____ 2. Accounting principles prescribed by federal or stateregulatory commissions for investor-owned and some governmentallyowned utilities.
_____ 3. Bonds whose principal and interest are payable exclusivelyfrom earnings of a public enterprise.
_____ 4. Bonds which carry the pledge of the government entityâsfull faith and credit, although the intent may be to service themfrom proprietary revenues rather than general taxes.
_____ 5. The account that captures the premium paid on a utilityplant purchased by a government.
1. The following are key terms in Chapter 7 that relateaccounting for the business-type activities of state and localgovernments:
A. Allowance for Funds Used during Construction
B. Revenue bonds
C. Utility plant acquisition adjustment
D. Regulatory accounting principles
E. Original cost
F. Historical cost
G. General obligation bonds
For each of the following definitions, indicate the key term fromthe list above that best matches by placing the appropriate letterin the blank space next to the definition.
_____ 1. In utility accounting, the net cost for the period ofconstruction of borrowed funds used for construction purposes and areasonable rate on other funds so used
_____ 2. Accounting principles prescribed by federal or stateregulatory commissions for investor-owned and some governmentallyowned utilities.
_____ 3. Bonds whose principal and interest are payable exclusivelyfrom earnings of a public enterprise.
_____ 4. Bonds which carry the pledge of the government entityâsfull faith and credit, although the intent may be to service themfrom proprietary revenues rather than general taxes.
_____ 5. The account that captures the premium paid on a utilityplant purchased by a government.
