A component unit is a legally separate entity for which the elected officials of the primary government are financially accountable. This accountability may arise if the primary government:
Appoints a majority of the governing board, and
Is able to impose its will or has the potential to receive financial benefits or bear financial burdens.
Component units are reported in the financial statements of the primary government, either as blended or discretely presented entities.
Relevant Standards and References:
GASB Statement No. 14, The Financial Reporting Entity
GASB Statement No. 61, The Financial Reporting Entity: Omnibus
GASB Codification Section 2100: Defining the Financial Reporting Entity Therefore, Option B is correct.

A basic financial statement that includes a budgetary comparison (typically the Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual) is used to demonstrate whether the government complied with its legally adopted budget.
This is a core element of accountability in governmental financial reporting and is required under GASB Statement No. 34.
Relevant References:
GASB Statement No. 34 - Budgetary Comparison Statements
GASB Codification Section 2400 - Budgetary Accounting and Reporting
GFOA Best Practices - Budget Monitoring and Reporting
B). demonstrate compliance with the legally adopted budget

The Prompt Payment Act (31 U.S.C. Chapter 39) mandates that federal agencies pay vendors on time.
Specifically, if a contract specifies a due date for payment, agencies are required to pay by that date. If no specific due date is mentioned, payment must be made within 30 days after the later of either:
Receipt of a proper invoice, or
Acceptance of goods/services.
If agencies fail to pay by the due date, they must automatically calculate and pay interest penalties to the vendor.
Relevant Standards and References:
31 U.S.C. § 3903 (Prompt Payment Act): "A payment is timely if it is made by the due date prescribed by the contract or within 30 days after receipt of a proper invoice or acceptance of goods or services." OMB Circular A-125, "Prompt Payment," Section 7(a) Treasury Financial Manual (TFM), Volume I, Part 6, Chapter 8040 Therefore, Option D is correct.

A government merger occurs when two or more legally separate governments are combined to form a new government, and the original governments cease to exist. This includes combinations like a city and county merging to form a unified government, with combined assets, liabilities, and operations.
There is no acquiring government - rather, the governments voluntarily combine into a new legal entity.
Relevant References:
GASB Statement No. 69 - Government Combinations and Disposals of Government Operations GASB Codification Section G60 - Definitions of Mergers vs. Acquisitions GFOA Government Restructuring Guidelines A). a government merger

The unobligated balance of an appropriation refers to the portion of the total appropriation authority that has not yet been committed (obligated) through contracts, purchase orders, or other legally binding agreements.
Formula:
Unobligated Balance = Total Appropriation - Total Obligations
This is a key control metric in federal and state financial management, used to determine how much funding remains legally available for future obligations.
Relevant Standards and References:
OMB Circular A-11, Section 20.3
GAO Principles of Federal Appropriations Law (Red Book)
FASAB SFFAS No. 7: Reporting on Budgetary Resources
Therefore, Option A is correct.