GFOA CPFO Exam - Topic 9 Question 120 Discussion

Actual exam question for GFOA's CPFO exam

Question #: 120
Topic #: 9

[All CPFO Questions]

GAAP requires that the fees for enterprise fund services like water, sewer, and electricity offset costs. As a policy decision, governing board members choose among four water and sewer rate structures. Those are all EXCEPT:

ADeclining Block and Seasonal Rate

BChanging Rate

CAscending block

DNone of these

Show Suggested Answer

Suggested Answer: B

by Maryann at Jan 05, 2026, 05:16 AM

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Janessa

3 days ago

Ascending block rate structure? That's a new one to me. I'll go with C just to be safe.

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Quinn

8 days ago

Hmm, I'm not sure about this one. I think the correct answer might be D, since the question is asking for the one that is NOT a GAAP-approved rate structure.

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Glenn

13 days ago

The declining block and seasonal rate structures are definitely GAAP-approved, so I'm going with A.

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Annamae

18 days ago

I feel like I've seen "Changing Rate" in a different context, but I can't remember if it's actually a recognized rate structure for water and sewer services.

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Elvera

24 days ago

I practiced a question similar to this, and I think "None of these" could be the answer if all the other options are valid structures.

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Margurite

29 days ago

I think the declining block and ascending block rates are common, but I can't recall if "Changing Rate" is a standard term used in GAAP discussions.

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Armando

1 month ago

I remember studying different rate structures, but I'm not entirely sure what a "Changing Rate" is. It sounds unfamiliar.

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Stanford

1 month ago

I've got a good handle on this. I think the answer is C) Ascending block, since that wouldn't necessarily offset costs like the other options.

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Cecilia

1 month ago

Declining block and seasonal rate seem like they would offset costs, so I'll rule those out. Ascending block and changing rate are the ones I need to evaluate further.

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