Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

GFOA CPFO Exam - Topic 2 Question 57 Discussion

Actual exam question for GFOA's CPFO exam
Question #: 57
Topic #: 2
[All CPFO Questions]

''A cash received as a loan is shown as revenue not as a liability, on the balance sheet. To correct for such cases, most cash accounting systems recognize not only cash but also other assets and liabilities arising through prior cash transactions. This adjustment, though, does not alter the fact that outstanding obligations have been incurred but not accounted for, thus overstating the available balance.'' This is an example of possible mishandlings after the selection of ________________.

Show Suggested Answer Hide Answer
Suggested Answer: D

by Sylvia at Aug 23, 2022, 03:45 PM

Limited Time Offer

25%

Off

Get Premium CPFO Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

0/2000 characters
Submit Cancel
Kara
4 months ago
Not sure about that, seems like a stretch to me.
upvoted 0 times
...
Felix
5 months ago
This is classic cash accounting confusion.
upvoted 0 times
...
Tayna
5 months ago
Surprised to see cash loans treated as revenue!
upvoted 0 times
...
Kirby
5 months ago
I disagree, it sounds more like accrual mishandling.
upvoted 0 times
...
Ollie
5 months ago
That's definitely a cash basis issue!
upvoted 0 times
...
Quentin
5 months ago
I feel like I might be mixing things up, but isn't the cash basis supposed to only recognize cash transactions? So, it must be A.
upvoted 0 times
...
Tayna
5 months ago
This reminds me of a practice question we did on cash basis accounting where we discussed how it can lead to overstated revenues.
upvoted 0 times
...
Shenika
5 months ago
I'm not entirely sure, but I think this could also relate to the modified basis of accounting since it involves adjustments for cash transactions.
upvoted 0 times
...
Rhea
5 months ago
I remember studying the differences between cash and accrual accounting, and this definitely sounds like a cash basis issue.
upvoted 0 times
...
Derick
6 months ago
I'm leaning towards option B - setting the firming time fence to lead-time plus one week. That seems like it would give us the most flexibility and control over the planning process.
upvoted 0 times
...
Merlyn
6 months ago
Hmm, this seems like a tricky one. I'll need to carefully review the configuration settings to identify any potential issues.
upvoted 0 times
...
Rebeca
6 months ago
This looks like a pretty straightforward routing configuration issue. I'd start by checking the interface settings on Router 2 to make sure the IP address and subnet mask are configured correctly.
upvoted 0 times
...
Rosalind
6 months ago
I recall how varying dividends can impact investor confidence. Nelson's proposal might protect corporate assets, but will shareholders really prefer that over an immediate increase in dividends?
upvoted 0 times
...
Paola
6 months ago
UDP is the obvious choice here. The question is asking about the transport layer, and UDP is one of the main protocols that operates at that layer in the TCP/IP model.
upvoted 0 times
...
Precious
10 months ago
Haha, the cash basis strikes again! It's like trying to balance your checkbook with your eyes closed. No wonder the balance sheet is a hot mess. Time to break out the abacus and get serious about accrual accounting, my friends.
upvoted 0 times
Rasheeda
10 months ago
C: Let's make the switch before our balance sheet gets even more confusing.
upvoted 0 times
...
Janet
10 months ago
B: Totally agree, we can't keep ignoring those outstanding obligations.
upvoted 0 times
...
Corazon
10 months ago
A: Yeah, cash basis can really mess things up. We need to switch to accrual accounting.
upvoted 0 times
...
...
Twila
11 months ago
Cash basis, you've really let us down this time. Looks like you're the one taking the loan, but not recording it properly. Maybe it's time to switch to the accrual basis and get your finances in order. Or, you know, just win the lottery and call it a day.
upvoted 0 times
William
10 months ago
C: Maybe it's time for a change in our accounting methods.
upvoted 0 times
...
Marge
10 months ago
B: I agree, it's important to accurately reflect our financial obligations.
upvoted 0 times
...
Cathrine
10 months ago
A: Yeah, cash basis can be tricky. Accrual basis might be a better choice.
upvoted 0 times
...
...
Stevie
11 months ago
Hmm, this one's a real head-scratcher. But I gotta say, if you're not keeping track of those pesky assets and liabilities, you're just asking for trouble. Time to step up your accounting game, people!
upvoted 0 times
...
Reita
11 months ago
Aha, this is a clear-cut case of the cash basis of accounting gone wrong. The question is spot on in highlighting how it can lead to overstating the available balance. Accrual basis all the way, folks!
upvoted 0 times
Bethanie
10 months ago
Yes, the accrual basis of accounting provides a more accurate picture of a company's financial position.
upvoted 0 times
...
Isidra
11 months ago
I agree, the cash basis of accounting can definitely lead to some mishandlings like this.
upvoted 0 times
...
...
Alyce
11 months ago
Whoa, this is a tricky one! Looks like the cash basis of accounting is the culprit here. That's a classic case of not recognizing all the assets and liabilities, leading to a distorted financial picture. Gotta watch out for those sneaky cash transactions!
upvoted 0 times
...
Kent
11 months ago
I'm not sure, but I think A) Cash basis of accounting would not address the issue mentioned in the question. It only records transactions when cash is exchanged, not when obligations are incurred.
upvoted 0 times
...
Candra
11 months ago
I agree with Annamae. Accrual basis of accounting recognizes revenues when they are earned and expenses when they are incurred, which would prevent mishandlings like the one mentioned.
upvoted 0 times
...
Annamae
12 months ago
I think the correct answer is B) Accrual basis of accounting.
upvoted 0 times
...

Save Cancel