California Preliminary Administrative Credential Examination (CPACE) Practice Exam

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Study for the California Preliminary Administrative Credential Examination (CPACE). Prepare with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your CPACE exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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What item is classified as a debt service apart from personnel salaries?

Property Taxes
Auxiliary Services Fund
Interest Earnings
Energy conservation bonds

The correct answer is: Energy conservation bonds

The classification of energy conservation bonds as a debt service item is rooted in their purpose and function within financial management. Energy conservation bonds are issued specifically to fund energy-saving projects, and the debt service on these bonds refers to the regular payments made to pay off the principal and interest associated with the bonds. These payments represent a formal obligation that the issuing entity must fulfill, similar to other types of bonds or loans. In contrast, property taxes are a revenue source rather than a debt service obligation, and interest earnings relate to the income generated from invested funds, which does not constitute a debt obligation. The Auxiliary Services Fund typically covers activities that support educational programs and may not pertain directly to debt service. Thus, energy conservation bonds specifically represent a financial obligation that needs to be serviced over time, classifying them correctly as a debt service item.