Accounting homework!

This assignment covers chapter 8 and is due by 10:00 p.m on Monday, 4/4. To answer these questions, use the 2014 CAFR for the City of Los Angeles found at www.lacity.org  and the 2014 annual report for the Los Angeles City Employees' Retirement System (LACERS).  The web address for the pension fund (LACERS) can be copied from page 155 of the CAFR for the city. This assignment includes 10 questions. plus one extra credit question.

Instructions

Answer questions 1-7 and the extra credit using the CAFR for the City of Los Angeles.  Answer questions 8-10 using the report for the LACERS pension fund.

QUESTION 1

1.  The city has which of the following fund types (check all that apply)? 

		Investment Trust Fund
		Pension Trust
		Tax Agency
		Agency funds that are not a tax agency.

1 points   

QUESTION 2

1. Read the plan descriptions of the 3 pension plans operated by the City and match the pension plan with where the pension expense for those employees would be recorded.

Pensions                                         LACERS                                         DWP plan

A. Governmental activities primarily B. Both governmental activities and business-type activities. C. Business activies

1 points   

QUESTION 3

1.  Which description below best describes the Pension  and Other Postemployment Funds for the city of Los Angeles?

		The assets equal the liabilities in this type of fund.
		The Pension Funds have significantly less assets than they do liabilities, which is what I would expect.
		The Pension Funds have significantly less assets than they do liabilities, which is NOT what I would expect.
		The Pension Funds have significantly more assets than they do liabilities, which is what I would expect.
		The Pension Funds have significantly more assets than they do liabilities, which is NOT what I would expect.

1 points   

QUESTION 4

1.  The value of investments held by the Pension Funds:

		Remained the same value
		Increased in value.
		Changes in value cannot be determined by the financial statements.
		Decreased in value.

1 points   

QUESTION 5

1.  Who contributed more to the pension plans in the current year?

		the city.
		the employees.
		Cannot be determined from the CAFR.
		the city and employees contributed equally.

1 points   

QUESTION 6

1. The enterprise funds of the city have:

		a pension liability that indicates the city pension plans are over-funded.
		a pension liability that indicates the city pension plans are under funded.
		no pension liability reported in the enterprise funds.
		a pension liability that indicates the total amount owed to enterprise fund employees for pensions.

1 points   

QUESTION 7

1.  In addition to accumulating resources to pay pensions, the city is also accumulating resources to pay for health benefits upon retirement.

 True

 False

1 points   

QUESTION 8

1.  During the last 3 years, the LACERS pension plan has become:

		more overfunded
		less underfunded
		less overfunded
		more underfunded

1 points   

QUESTION 9

1. Which of the following had the greatest impact on the LACERS net pension liability?

		Service cost
		Interest cost
		Benefit payments
		Total contributions.
		None of these had an impact on the net pension liability.

1 points   

QUESTION 10

1. What is the rate of return earned by LACER plan assets in the most recent year?

		247.3%
		18.2%
		72.6%
		15.7%

1 points   

QUESTION 11

1.  Assume the city is considering transferring some of its pension fund assets to a new high interest investment pool sponsored by the State of California.  How would this transaction be accounted for in the city of Los Angeles' financial statements.

		As an investment in the pension fund.
		As an addition in a newly created Investment Trust Fund.
		Both A and B
		This transaction would not be reflected in any of the funds reported in the CAFR.