The liability for special assessment bonds that carry a secondary pledge of a city's general credit should be reported in the balance sheets of:

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Multiple Choice

The liability for special assessment bonds that carry a secondary pledge of a city's general credit should be reported in the balance sheets of:

Explanation:
Having a secondary pledge of the city’s general credit makes the bonds a general obligation of the government. In GASB reporting, general obligation debt is classified with governmental activities in the government-wide balance sheet, since the city can rely on its full taxing power and general resources to meet the debt. That’s why the liability belongs with the governmental activities, not with business-type (enterprise) activities, fiduciary funds, or purely enterprise-type records.

Having a secondary pledge of the city’s general credit makes the bonds a general obligation of the government. In GASB reporting, general obligation debt is classified with governmental activities in the government-wide balance sheet, since the city can rely on its full taxing power and general resources to meet the debt. That’s why the liability belongs with the governmental activities, not with business-type (enterprise) activities, fiduciary funds, or purely enterprise-type records.

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