67.
Gotham City
General Fund Trial Balance
June 30, 20X9
Debit
Credit
Cash
230,000
Taxes Receivable—Current
150,000
Allowances for Uncollectible Current Taxes
10,000
Taxes Receivable—Delinquent
25,000
Allowances for Uncollectible Delinquent Taxes
20,000
Inventory of Supplies
55,000
Vouchers Payable
110,500
Tax Anticipation Notes Payable
100,000
Fund Balance—Nonspendable
55,000
Fund Balance—Unassigned
50,000
Revenues
2,455,000
Expenditures
2,255,000
Other Financing Sources
110,000
Other Financing Uses
95,500
Encumbrances
125,000
Fund Balance—Assigned
125,000
Estimated Revenues
2,450,000
Appropriations
2,300,000
Estimated Other Financing Sources
110,000
Estimated Other Financing Uses
96,000
Budgetary Fund Balance—Unassigned
164,000
5,545,500
5,545,500
The Inventory of Supplies and Fund Balance—Nonspendable have been adjusted to reflect ending inventory. The beginning inventory balance was
$0. Fund Balance—Unassigned was $5,000 before the adjustment.
Using the information above, prepare the closing entries for the General Fund of Gotham City on June 30, 20X9.
Appropriations
2,300,000
Estimated Other Financing Uses
96,000
Budgetary Fund Balance—Unassigned
164,000
Estimated Revenue
2,450,000
Estimated Other Financing Sources
110,000
Revenues
2,455,000
Other Financing Sources
110,000
Expenditures
2,255,000
Other Financing Uses
95,500
Encumbrances
125,000
Fund Balance—Unassigned
89,500
68. The pre-closing trial balance of the General Fund of Volter Village at the end of its fiscal year, June 30,
20X1, is as follows:
Cash
19,800
Tax Receivable—Delinquent
40,000
Allowance for Uncollectible Delinquent Taxes
8,400
Vouchers Payable
19,000
Fund Balance—Assigned
22,000
Fund Balance—Unassigned
46,000
Revenues
201,600
Expenditures
215,200
Encumbrances
22,000
Estimated Revenues
200,000
Appropriations
196,000
Budgetary Fund Balance—Unassigned
4,000
497,000
497,000
Required:
a.
Prepare closing entries.
b.
Prepare a statement of revenues, expenditures, and changes in fund balances for the General Fund for the year ended June 30, 20X1.
c.
Prepare the General Fund balance sheet as of June 30, 20X1.
69.
Gotham City
General Fund Trial Balance
June 30, 20X9
Debit
Credit
Cash
230,000
Taxes Receivable—Current
150,000
Allowances for Uncollectible Current Taxes
10,000
Taxes Receivable—Delinquent
25,000
Allowances for Uncollectible Delinquent Taxes
20,000
Inventory of Supplies
55,000
Vouchers Payable
110,500
Tax Anticipation Notes Payable
100,000
Fund Balance—Nonspendable
55,000
Fund Balance—Unassigned
50,000
Revenues
2,455,000
Expenditures
2,255,000
Other Financing Sources
110,000
Other Financing Uses
95,500
Encumbrances
125,000
Fund Balance—Assigned
125,000
Estimated Revenues
2,450,000
Appropriations
2,300,000
Estimated Other Financing Sources
110,000
Estimated Other Financing Uses
96,000
Budgetary Fund Balance—Unassigned
164,000
5,545,500
5,545,500
The Inventory of Supplies and Fund Balance—Nonspendable have been adjusted to reflect ending inventory. The beginning inventory balance was
$0. Fund Balance—Unassigned was $5,000 before the adjustment.
Using the information above, prepare a Statement of Revenues, Expenditures, and Change in Fund Balance—Budget and Actual for the General Fund
for Gotham City for the year end June 30, 20X9.
Gotham City
General Fund Statement of Revenues, Expenditures, and
Change in Fund Balance – Budget to Actual
For the Fiscal Year Ended June 30, 20X9
Favorable
Budget
Actual
(Unfavorable)
Revenues
$2,450,000
$2,455,000
$ 5,000
Expenditures
2,300,000
2,255,000
45,000
Excess of revenues over expenditures
$ 150,000
$ 200,000
$50,000
Other financing sources (uses)
14,000
14,500
500
Excess of revenues and other sources
over expenditures and other uses
$ 164,000
$ 214,500
$50,500
Fund balance July 1, 20X8
5,000
5,000
0
Fund balance June 30, 20X9
$ 169,000
$ 219,500
$50,500
70.
Gotham City
General Fund Trial Balance
June 30, 20X9
Debit
Credit
Cash
230,000
Taxes Receivable—Current
150,000
Allowances for Uncollectible Current Taxes
10,000
Taxes Receivable—Delinquent
25,000
Allowances for Uncollectible Delinquent Taxes
20,000
Inventory of Supplies
55,000
Vouchers Payable
110,500
Tax Anticipation Notes Payable
100,000
Fund Balance—Nonspendable
55,000
Fund Balance—Unassigned
50,000
Revenues
2,455,000
Expenditures
2,255,000
Other Financing Sources
110,000
Other Financing Uses
95,500
Encumbrances
125,000
Fund Balance—Assigned
125,000
Estimated Revenues
2,450,000
Appropriations
2,300,000
Estimated Other Financing Sources
110,000
Estimated Other Financing Uses
96,000
Budgetary Fund Balance—Unassigned
164,000
5,545,500
5,545,500
The Inventory of Supplies and Fund Balance—Nonspendable have been adjusted to reflect ending inventory. The beginning inventory balance was
$0. Fund Balance—Unassigned was $5,000 before the adjustment.
Using the information above, the year-end trial balance for the General Fund of Gotham City, prepare the June 30, 20X9, General Fund balance
sheet for Gotham City.
Assets
Tax receivable—delinquent
$ 25,000
Less allowances for uncollectible delinquent taxes
20,000
5,000
Inventory of supplies
55,000
Total Assets
$430,000
Liabilities:
Vouchers payable
$110,500
Tax anticipation notes payable
100,000
Nonspendable
55,000
Unassigned
39,500
Total Fund Balance
219,500
Accounts closed to Fund Balance:
Other Financing Uses
(95,500)
Ending Fund Balance
$219,500
Fund Balance—Nonspendable
55,000
180,000
71. The following activities took place in the city of Littlewood during 20X2. Make the necessary journal
entries to account for these transactions in the General Fund, including the year end closing entries. Littlewood
does not utilize an encumbrance system.
a.
The budget for 20×2 was approved.
Estimated Revenues
$1,300,000
Estimated Other Financing Sources
50,000
Estimated Operating Expenditures
800,000
Estimated Equipment Purchases
100,000
Estimated Other Financing Uses
10,000
b.
The general tax levy for 20X2 was $1,000,000 with a 5% estimate of uncollectible accounts. The remaining
balance from the 2001 fiscal year was $75,000 in Taxes Receivable-Current with and Allowance of $20,000.
c.
Equipment was purchased that was invoiced at $93,500.
d.
Invoices were received for operating expenditures in the amount of $815,000 and vouchered.
e.
Payment was made on items (c) and (d) above.
f.
Collections of $895,000 on current taxes and $5,000 on Delinquent taxes were received. A state grant was
received in the amount of $250,000.
g.
Fines and fees are collected in the amount of $85,000.
h.
The city sold equipment having a basis of $60,000 in the General Fixed Asset Account Group for $50,000.
72. Consider the following events:
a.
The General Fund vouchered the purchase of trucks for $65,000. The purchase had been encumbered earlier in the year at $60,000.
b.
Several years ago, equipment costing $15,000 was acquired with General Fund Revenues. It was sold for $5,000, with proceeds belonging
to the General Fund.
c.
Early in the year, a citizen donated land appraised at $100,000 to the city. She submitted plans for a new library and agreed to cover the
total cost of construction, paying the company directly as work proceeds. At year end, the building was two-thirds finished, with costs to
date of $300,000.
d.
A snow plow was purchased with General Fund cash for $48,000, which represented a cost of $61,000 less trade-in of $13,000 for an old
snow plow originally purchased for $35,000 from Special Revenue Funds. As an emergency purchase, the acquisition of the new snow
plow had not been encumbered.
Required:
Prepare journal entries to record the events using the General Fund and the General Fixed Assets Account Group:
73. Following is a list of selected transactions for the City of Alpena:
a.
The city used general property taxes to purchase a computer for the police department. The cost of the computer was $30,000. It was not
encumbered.
b.
Joseph Green donated land and a building to the city with book values of $25,000 and $150,000, respectively. When the gift was made, the
appraisal values were $35,000 for the land and $135,000 for the building.
c.
The city sold an old police car originally purchased by the General Fund for $10,000. The selling price was $2,500.
Required:
Make the necessary journal entries in the funds and account groups affected.
General Fund
Expenditures
30,000
Vouchers Payable
30,000
GFAAG
Equipment
30,000
Investment in General Fixed
Assets—General Fund Revenues
30,000
b.
GFAAG
Land
35,000
Building
135,000
Investment in General
Fixed Assets—Donations
170,000
General Fund
Cash
2,500
Other Financing
Source—Disposal of Asset
2,500
GFAAG
Investment in General Fixed
Assets—General Fund Revenues
10,000
Equipment
10,000
74. The following transactions occurred in the City of Maineville during 20X1:
a.
General obligation term bonds with a face value of $2,500,000 were sold for $2,550,000. The proceeds from the bond issue were to be
used to construct a new library and were received by the Capital Projects Fund.
b.
$200,000 was transferred from the General Fund to the Debt Service Fund to begin saving for the retirement of the bonds in transaction a.
at maturity.
c.
$150,000 was transferred from the General Fund to the Debt Service Fund to retire a portion of a serial bond due in 20X1.
d.
A police car was purchased for $18,000 and the trade-in of an old police car originally purchased for $15,000 from the General Fund. The
new vehicle had a list price and fair market value of $21,500.
e.
The serial bonds funded in transaction c. were retired on their maturity date.
f.
By year end, $450,000 of the work had been completed on the new library.
Required:
Prepare the necessary journal entries to record the transactions in the General Fixed Asset Account Group (GFAAG) and the General Long-term
Debt Account Group (GLTDAG), and identify in which it should be recorded.
Fund or
Entry
DEBIT
CREDIT
Group
a.
Amount to Be Provided for Payment
of Term Bonds
2,500,000
GLTDAG
Term Bonds Payable
2,500,000
b.
Amount Available in Debt Service
Funds-Term Bonds
200,000
GLTDAG
Amount to Be Provided for
Payment of Term Bonds
200,000
c.
Amount Available in Debt Service
Funds—Serial Bond
150,000
GLTDAG
Amount to be Provided for
Payment of Serial Bonds
150,000
d.
Equipment
21,500
GFAAG
Investment in General Fixed
Assets—General Fund
21,500
Investment in General Fixed
Assets—General Fund
15,000
GFAAG
Equipment
15,000
e.
Serial Bonds Payable
150,000
GLTDAG
Amount Available in Debt Service
Funds—Serial Bonds
150,000
Construction in Progress
450,000
GFAAG
Investment in General Fixed Assets
—Capital Projects Fund
450,000
75. The following transactions were made by Cape City:
August 1, 20X9
A wealthy business person donates a downtown office building to Cape City. Its fair market value is
$2,500,000. The city intends to sell the building.
August 15, 20X9
The city purchases a warehouse to be used for storage and pays $1,500,000 from the General Fund.
September 1, 20X9
The donated office building is sold for $2,600,000.
Required:
Make the journal entries necessary to record the transactions in the General Fund and in the General Fixed Assets Account Group (GFAAG).
August 1, 20X9
General Fund
No entry required
GFAAG
Office Building
2,500,000
Investment in General Fixed
Assets—Donations
2,500,000
August 15, 20X9
General Fund
Expenditures
1,500,000
Cash
1,500,000
GFAAG
Warehouse
1,500,000
Investment in General Fixed
Assets—General Fund Revenues
1,500,000
September 1, 20X9
General Fund
Cash
2,600,000
Other Financing Source—
Disposal of Asset
2,600,000
GFAAG
Investment in General Fixed
Assets—Donations
2,500,000
Office Building
2,500,000
76. Following is a list of selected transactions for the City of Andrew:
a.
The city issued $750,000 in term bonds. The bonds sold at 102.
b.
After the payment of interest, the city transferred $100,000 from the General Fund to retire serial bonds.
c.
The bonds in b are retired.
Required:
Make the necessary journal entries in the funds and account groups affected except the Debt Service Fund.
77. What is the concept of interperiod equity?
General Fund
Cash (750,000 x 1.02)
765,000
Other Financing
Source—Bond Proceeds
765,000
General
Amount to Be Provided
Long-term Debt
for Payment of Term
Account Group
Bonds
750,000
Term Bonds
750,000
b.
General Fund
Other Financing Use
100,000
Cash
100,000
GLTDAG
Amount Available in Debt
Service Fund—Serial
Bonds
100,000
Amount to Be Provided
for Payment of
Serial Bonds
100,000
c.
GLTDAG *
Serial Bonds Payable
100,000
Amount Available in
Debt Service Funds—
Serial Bonds
100,000
78. Describe the three basic fund types and account groups and explain what changes, if any, the adoption of
GASB standard #34 has made on these classifications?
The three basic funds are:
79. 1) Discuss how revenue is recognized under the modified accrual method.
2) Discuss how this impacts each of the revenues listed below:
a) Imposed taxes such as property taxes
b) Grants from governmental units
c) Donations
d) Service charges such as trash removal fees
e) Investment revenue
f) Fees from licenses and permits
g) Derived taxes such as sales taxes
80. Explain why governmental funds use budgetary accounts.
time period in which they may be used, Deferred Revenue is credited.
group.
e) Investment revenue should be recognized when earned. Gains and losses should be recognized when an investment is sold.
soon enough thereafter to finance expenditures for the period.
81. Define an encumbrance and explain why a state or local government would use encumbrances.
82. What is infrastructure and where would it be accounted for?