Understanding Budgeting Terms Quiz 1

What does GAAP stand for in accounting?

• General Accounting and Auditing Principles

• Generally Accepted Accounting Principles

• Generalized Accounting and Auditing Practices

• Generally Acknowledged Accounting Practices

What is a Contingency Fund primarily used for?

• Regular operational expenses

• Emergency and unanticipated needs

• Long-term investments

• Employee salaries

Which of the following best describes a Millage Rate?

• A tax rate applied to income

• A tax rate applied to property

• A tax rate applied to sales

• A tax rate applied to imports

What is a Capital Purchase?

• A minor purchase for daily operations

• A significant purchase justified by value or longevity

• A purchase made with borrowed funds

• A purchase of stocks and bonds

What does a Tax Digest include?

• Only the list of taxes owed

• Only the list of property values

• Taxes owed, tax rates, and property values

• Only the list of tax rates

Who typically has access to a Contingency Fund?

• Any employee

• The head of the agency

• The finance department

• The general public

What ethical issue is associated with the Contingency Line?

• Over-reporting expenses

• Under-reporting income

• Padding the fund with more money than needed

• Misreporting tax rates

How is the Millage Rate expressed?

• As a percentage of income

• As a dollar amount per $1000 of assessed property value

• As a percentage of sales

• As a fixed amount per property

Which of the following is NOT a component of a Tax Digest?

• Tax rates

• Property values

• Employee salaries

• Taxes owed

What is the primary purpose of GAAP?

• To create financial statements

• To ensure consistency in financial reporting

• To calculate taxes

• To manage payroll