In government budgeting, the Estimated Revenues control account is credited when:

• A. When revenues are recorded
• B. When the budget is closed
• C. When expenditures are incurred
• D. When encumbrances are established

Answer: (A)

Budgetary accounting uses control accounts to track resources the government expects to receive. The Estimated Revenues control account specifically records the anticipated inflows for the period. It is credited when revenues are estimated in the budget because that action reflects the planned, available resources and increases the balance available to fund appropriations and expenditures. Later, when actual revenues are recorded, the budgetary entries are adjusted to reflect the difference between estimated and actual inflows.

The other events—closing the budget, incurring expenditures, or establishing encumbrances—do not represent the moment revenues are recognized in the budget. They pertain to budget execution or encumbrance control, not to recording anticipated revenues.