In a governmental funds balance sheet, prepared in conformity with GAAP, a separate column is provided for eacha.Fund type.b.Government.c.Major fund.d.Significant fund
Question
In a governmental funds balance sheet, prepared in conformity with GAAP, a separate column is provided for eacha.Fund type.b.Government.c.Major fund.d.Significant fund
Solution
In a governmental funds balance sheet prepared in conformity with Generally Accepted Accounting Principles (GAAP), a separate column is provided for each major fund. This is because GAAP requires that major funds be reported separately to provide more detailed information to the users of the financial statements. Major funds are funds whose revenues, expenditures/expenses, assets, or liabilities (excluding extraordinary items) are at least 10 percent of corresponding totals for all governmental or enterprise funds and at least 5 percent of the aggregate amount for all governmental and enterprise funds.
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