Governmental and Nonprofit Accounting 10th Edition

Governmental and Nonprofit Accounting: Theory and Practice, 10e (Freeman) Problems Chapter 2 The material in Chapter 2 is best suited for two types of problems: 1. Matching funds to fund types or fund definitions; and 2. Transaction analysis. Since transactions are an essential part of Chapters 3 through 12 and 16 through 18, we

Answers: # Fund or Nonfund Accounts Accounts Debit Credit 1a SC GF Taxes Receivable Current 12,000 Allowance for Uncollectible Taxes Current 240Revenues Property Taxes 11,7601b SC AF Taxes Receivable for Taxing Units 20,000Due to Taxing Units 20,0002 SC AF Cash 15,200Taxes Receivable for Taxing Units 15,2003a SC GF Allowance for Uncollectible Taxes Current 120Taxes Receivable

# Fund or Nonfund Accounts Accounts Debit Credit 1a GF Expenditures Operating 400 Due to Pension Trust Fund 4001b GF Expenditures Operating (Salaries and Wages) 2,000Cash 1,600Due to Pension Trust Fund 4001c EF Expenses Operating 150Due to Pension Trust Fund 1501d EF Expenses Operating (Salaries and Wages) 900Cash 750Due to Pension Trust Fund 1501e PTF

Problem 3 Statement of Net Position Reconciliation Information about the conversion of the Governmental Funds Balance Sheet to the Statement of Net Position for the City of Pleasant Hill is presented below (all amounts are in thousands of dollars): All governmental funds' fund balances................................................................ $13,000 Deferred revenue related to property taxes.......................................................... 2,000 Accrued

# Accounts Debit Credit 1 Cash 300 Unrestricted Support -- Contributions 3002 Cash 1,245Temporarily Restricted Support Contributions Education 43Temporarily Restricted Support Contributions Building 202Permanently Restricted Support Contributions Endowment 1,0003 Pledges Receivable 28,000Allowance for Uncollectible Pledges 2,800Temporarily Restricted Support Contributions Education 2,700Temporarily Restricted Support Contributions Building 4,500Permanently Restricted Support Contributions Endowment 18,0004 Cash

Problem 3 The following information was derived from the accounts and records of Mockingbird State University for 20X3. All amounts are in thousands of dollars. Tuition and fees Total assessed....................................................................................................... $4,000 Expected uncollectible......................................................................................... 80 Appropriations State...................................................................................................................... 800 Auxiliary enterprises Sales..................................................................................................................... 500 Salaries................................................................................................................. 280 Other expenses..................................................................................................... 140 Endowment income Restricted to research........................................................................................... 370 Private gifts and grants Restricted to student scholarships........................................................................ 0,200

Answer: Jackson County Hospital Statement of Revenues, Expenses, and Changes in Net Position For the Year Ended December 31, 20X0 Net Patient Service Revenues** $15,690Other RevenuesCafeteria Sales 440Total Operating Revenues 16,130ExpensesNursing Services $8,000Other Professional Services 890General Services 1,100Fiscal Services 300Administrative 440Depreciation (1,400 + 2,740) 4,140 14,870Operating Income 1,260Nonoperating Gains and LossesState Appropriations Operating

Trans # Assets Liabilities Fund Balance GCA GLTL Net Position 1 9,700 NE 9,700 NE NE NE 2 500 500 NE NE NE NE3 NE 135 (135) NE NE NE4 8,650(8,500)NE 150 NE NE NE5 50(50)NE NE NE NE NE6 10 NE 10 NE NE NE7 (505) (500) (5) NE NE NE8 5 NE 5 (30)* NE

City of Walland Preclosing Trial Balance For the Year Ended June 30, 20X4 Advance to Enterprise Fund................................................................................. 1,000 Allowance for Uncollectible Taxes...................................................................... 300 Appropriations..................................................................................................... 8,850 Budgetary Fund Balance...................................................................................... 150 Cash...................................................................................................................... $5,000 Due from Special Revenue Fund......................................................................... 100 Encumbrances Outstanding................................................................................. 60 Encumbrances...................................................................................................... 60 Estimated Revenues............................................................................................. 9,000 Expenditures Capital Outlay............................................................................. 2,500 Expenditures Operating.................................................................................... 6,340 Fund Balance (July 1, 20X3)............................................................................... 9,505 Investments.......................................................................................................... 2,500 OFS Proceeds from Sale of Vehicle..................................................................

2. F reported as a capital outlay expenditure by the SRF 3. C 4. F reported as a general long-term liability until paid 5. F Balance Sheet liability 6. F not accrued 7. A 8. A 9. F Balance Sheet liability 10. F reported as an encumbrance until received 11.

(2) Indicate the effects of each transaction on the accounting equation of the Capital Projects Fund and on the General Capital Assets and General Long-Term Liabilities accounts. If an element is not affected, put NE in the appropriate box. 41 Copyright 2013 Pearson Education, Inc. Answers: # Accounts Debit Credit A (1) BANs treated

Answers: Requirement #1 # Accounts Debit Credit Situation A 1 Cash 8,160OFS Refunding Bonds 8,1602 OFU Bond Principal Retirement 8,160Cash 8,160Situation B1 Cash 4,000OFS Refunding Bonds 4,0002 Cash 4,160OFS Transfer from GF 4,1603 OFU Bond Principal Retirement 4,000Expenditures Debt Service Principal 4,160Cash 8,160 1 Cash 8,160OFS Refunding Bonds 8,1602 OFU Bond Principal Retirement 8,160Cash

# Fund or Nonfund Accounts Accounts Debit Credit 1a GF Expenditures Capital Outlay 2,000 OFS Capital Lease 2,0001b GCA/GLTL Equipment under Capital Lease 2,000Leases Payable 2,0002a CPF Encumbrances 4,500Encumbrances Outstanding 4,5002b CPF Cash 500OFS Transfer from GF 5002c GF OFU Transfer to CPF 500Cash 5003a CPF Cash 400OFS BANs Principal 4003b GLTL Net Position 400BANs

Problem 7 Other Interfund Transactions: Debt Refunding Transactions: The City of Armona has decided to refinance $8,000 of par value, general government, general obligation bonds outstanding. The bonds had a related unamortized bond premium of $200. The city issues $6,000 of refunding bonds and transfers $2,700,000 from the General Fund to the

10. Cash received from a capital grant, $5,000. 11. Cash paid for construction costs that qualify under the capital grant, $1,500. 12. The City acquired land for future plant expansion, $750, by issuing a 10-year bond in the same amount. 13. Cash received from operating grants, $500. 14. Cash paid for salaries covered by

Governmental and Nonprofit Accounting: Theory and Practice, 10e (Freeman) Chapter 1 Governmental and Nonprofit AccountingEnvironment and Characteristics 1. Which of the following would not be considered a government or nonprofit organization? A. A software company that sells software exclusively to state and local governments. B. A public elementary school. C. A church. D. A

17. The Public Utilities Enterprise Fund was ordered by the court to pay environmental damages of $500,000. The fund is to pay $100,000 immediately and the remaining $400,000 in equal installments for next four years. In the year of the judgment, the Enterprise Fund would report A. $500,000 in expenses. B. $500,000 in

24. If a Self-Insurance Internal Service Fund pays claims of $5,000 during the month, the fund will report A. Expenses of $5,000. B. Transfers out of $5,000. C. Nonoperating expenses of $5,000. D. A decrease in prepaid assets of $5,000. (Answer: A; Moderate; LO5) (Answer: A; Moderate; LO5) (Answer: A; Moderate; LO5) 25. If a government has more

(Answer: C; Easy; LO2) 10. For general purpose external financial reporting, discretely presented component unit information A. Is not presented. B. Is included in the government-wide statements only. C. Is included in the fund financial statements only. D. Is included in both the government-wide and the fund financial statements. (Answer: B; Moderate; LO2) (Answer: B; Moderate; LO2) (Answer:

10. A city has a long-term general government liability for compensated absences of $700,000 at the beginning of the year and $650,000 at the end of the year. What adjustment is needed to changes in fund balance to reconcile the governmental funds operating statement information to the changes in net

A. Required in the basic financial statements and in the CAFR. B. Optional in the basic financial statements but required in the CAFR. C. Optional in the basic financial statements and optional in the CAFR. D. Required in the CAFR. (Answer: D; Moderate; LO1) 12. Footnote information that duplicates information in financial statements included in

21. In 20X8 the following pledges were made: $35,000 in unrestricted contributions for use in 21. In 20X8 the following pledges were made: $35,000 in unrestricted contributions for use in 21. In 20X8 the following pledges were made: $35,000 in unrestricted contributions for use in 20X8; $20,000 in contributions restricted

33. A government college received a $2 million grant restricted to research on developing a process for synthesizing a stable triple helix. $500,000 of qualifying research costs were incurred during the year. The college should report: A. Grant revenues of $2 million. B. Grant revenues of $500,000 and a liability for unearned

14. When agency directors make allotments, what budgetary accounts are affected? A. Unapportioned Authority and AllotmentsRealized Resources. B. AllotmentsRealized Resources and Undelivered Orders. C. Appropriations and AllotmentsRealized Resources. D. AllotmentsRealized Resources and Expended Appropriations. (Answer: C; Moderate; LO4) (Answer: C; Moderate; LO4) (Answer: C; Moderate; LO4) 15. Assume that Congress enacted an appropriation for a federal agency in

25. Incurring construction costs on a major general government capital project would A. Decrease fund balance in a Capital Projects Fund. B. Decrease cash in the General Capital Assets accounts. C. Increase capital assets in a Capital Projects Fund. D. Increase capital assets in the General Fund. (Answer: A; Moderate; LO4) (Answer: A; Moderate; LO4) (Answer:

B. A net decrease of $5,000. C. A decrease of $15,000. D. A net increase of $5,000. (Answer: A; Moderate; LO3) 19. The city's central garage, which is accounted for as an Internal Service Fund, repairs and maintains all of the city's vehicles. The fire department is accounted for in the General Fund.

B. The budgetary entry to record an encumbrance would be a debit to Encumbrances and a credit to Encumbrances Outstanding. C. If the actual cost of a purchase exceeds the amount of the original encumbrance, the original encumbrance is still reversed at the original amount. D. The recording of an encumbrance is

A. Taxes Receivable Allowance for Uncollectible Taxes Allowance for Discounts5,000 Allowance for Discounts5,000 Allowance for Discounts 5,000 Revenues $700,000 $14,000 681,000 B. Taxes Receivable Revenues $700,000 $700,000 C. Taxes Receivable$695,000 C. Taxes Receivable$695,000 C. Taxes Receivable $695,000 Expenditures Allowance for Uncollectible Taxes$14,000 Allowance for Uncollectible Taxes$14,000 Allowance for Uncollectible Taxes $14,000 Revenues 5,000 686,000 D. Taxes Receivable Allowance for Uncollectible Taxes$14,000 Allowance for Uncollectible Taxes$14,000 Allowance for Uncollectible Taxes $14,000 Revenues $700,000 686,000 (Answer: A; Difficult; LO4) (Answer: A; Difficult; LO4) (Answer: A; Difficult; LO4) 13.

14. The General Fund reported a beginning balance of inventory of materials and supplies of $122,000. The ending balance was $150,000. Supplies purchased during the year totaled $600,000. The county uses the consumption method. The General Fund should report expenditures for materials and supplies for the year of A. $450,000. B.

22. A city was awarded a $600,000 federal grant to help finance a bridge construction project that is expected to take two years to complete. The grant will be paid in two installments: (1) that is expected to take two years to complete. The grant will be paid in two

15. Assume that a Debt Service Fund does not have nonspendable fund balance. Further assume that after restricted and committed levels of fund balance have properly identified, the remaining balance is a deficit. This deficit fund balance should A. Be reported as negative assigned fund balance. B. Be reported as a negative

14. The city's new tax collector foreclosed on a piece of land. The fair market value of the land at the time of foreclosure was $9,000. The taxpayer had acquired the property at a cost of $11,000. The past due taxes on the property totaled $4,000. The city plans to retain