Chapter 17 – Accounting and Reporting for the Federal Government
17–16
Ch. 17, Solutions, 17-17 (Cont’d)
SAVE OUR RESOURCES COMMISSION
Debits Credits
PROPRIETARY
CUMULATIVE RESULTS OF OPERATIONS 2,900,000
General Problem Information: Fund balance with U.S. Treasury
Learning Objective: 17-4
Topic: Dual-track Accounting System
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: FN: Measurement
Level of Difficulty: Hard
17–18
a. SAVE OUR RESOURCES COMMISSION
STATEMENT OF BUDGETARY RESOURCES
FOR THE YEAR ENDED SEPTEMBER 30, 2017
BUDGETARY RESOURCES:
BUDGETARY AUTHORITY $4,810,000
STATUS OF BUDGETARY RESOURCES:
Chapter 17 – Accounting and Reporting for the Federal Government
17–17
Ch. 17, Solutions, 17-18 (Cont’d)
(Note A: Obligations Incurred is the expended authority of current year of
$4,500,000 plus $310,000 for undelivered orders.)
(Note B: Outlays equals expended authority)
b. SAVE OUR RESOURCES COMMISSION
STATEMENT OF CHANGES IN NET POSITION
FOR THE YEAR ENDED SEPTEMBER 30, 2017
CUMULATIVE RESULTS UNEXPENDED
OF OPERATIONS APPROPRIATIONS
BEGINNING BALANCE $1,009,000 $ 0
Chapter 17 – Accounting and Reporting for the Federal Government
17–18
Ch. 17, Solutions, 17-18 (Cont’d)
c. SAVE OUR RESOURCES COMMISSION
BALANCE SHEET
AS OF SEPTEMBER 30, 2017
ASSETS
INTRAGOVERNMENTAL:
FUND BALANCE WITH TREASURY⎯2017 $ 329,000
GOVERNMENTAL:
OPERATING MATERIALS AND SUPPLIES 63,000
PLANT AND EQUIPMENT (NET OF ACCUMULATED
General Problem Information: Federal agency financial statements
Learning Objective: 17-4
Topic: Dual-track Accounting System
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: FN: Reporting
Level of Difficulty: Hard
Chapter 17 – Accounting and Reporting for the Federal Government
17–19
Ch. 17, Solutions (Cont’d)
17-19.
RURAL ASSISTANCE AGENCY
STATEMENT OF NET COST
FOR THE YEAR ENDED SEPTEMBER 30, 2017
FOOD BANK
COSTS
$ 9,632,800
LESS: EARNED REVENUE
2,611,900
NET COST
7,020,900
HOUSING SERVICES
COSTS
7,438,500
LESS: EARNED REVENUE
1,237,400
NET COST
6,201,100
CREDIT COUNSELING
COSTS
2,391,000
LESS: EARNED REVENUE
87,000
NET COST
2,304,000
TOTAL
COSTS
19,462,300
LESS: EARNED REVENUE
3,936,300
NET COST OF OPERATIONS
$15,526,000
General Problem Information: Statement of net costs
Learning Objective: 17-4
Topic: Dual-track Accounting System
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: FN: Reporting
Level of Difficulty: Medium
Chapter 17 – Accounting and Reporting for the Federal Government
17–20
Ch. 17, Solutions (Cont’d)
17-20. FEDERAL ANTIQUITIES ADMINISTRATION
STATEMENT OF BUDGETARY RESOURCES
FOR THE 11 MONTHS ENDED AUGUST 31, 2017
BUDGETARY RESOURCES:
BUDGET AUTHORITY (Note A):
APPROPRIATIONS RECEIVED (Note A)
$4,894,855
TOTAL BUDGETARY RESOURCES
$4,894,855
STATUS OF BUDGETARY RESOURCES:
OBLIGATIONS INCURRED (Note B)
$4,144,855
UNOBLIGATED BALANCES (Note C)
750,000
TOTAL STATUS OF BUDGETARY RESOURCES
$4,894,855
CHANGE IN OBLIGATED BALANCE:
UNPAID OBLIGATIONS, BEGINNING OF THE PERIOD
$ 1,210,210
OBLIGATIONS INCURRED (Note B)
4,144,855
OUTLAYS (Note D)
(4,690,934)
UNPAID OBLIGATIONS, END OF PERIOD (Note E)
$ 664,131
Note A: Total budgetary resources are given by the balance of Other
Appropriations Realized of $4,894,855.
Note B: Expended authority of current year of $3,480,724 plus $664,131
General Problem Information: Statement of budgetary resources
Learning Objective: 17-4
Topic: Dual-track Accounting System
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: FN: Reporting
Level of Difficulty: Medium
Chapter 17 – Accounting and Reporting for the Federal Government
17–21
Ch. 17, Solutions (Cont’d)
17-21. a. FLOOD CONTROL COMMISSION
GENERAL JOURNAL
Debits Credits
1. BUDGETARY
OTHER APPROPRIATIONS
REALIZED⎯2017 7,000,000
UNAPPORTIONED AUTHORITY⎯2017 7,000,000
PROPRIETARY
2. BUDGETARY
UNAPPORTIONED AUTHORITY⎯2017 7,000,000
APPORTIONMENTS⎯2017 7,000,000
3. BUDGETARY
Chapter 17 – Accounting and Reporting for the Federal Government
17–22
Ch. 17, Solutions, 17-21 (Cont’d)
FLOOD CONTROL COMMISSION
GENERAL JOURNAL
Debits Credits
PROPRIETARY
OPERATING/PROGRAM EXPENSES 170,000
DISBURSEMENTS IN TRANSIT⎯2017 170,000
Chapter 17 – Accounting and Reporting for the Federal Government
17–23
Ch. 17, Solutions, 17-21 (Cont’d)
FLOOD CONTROL COMMISSION
GENERAL JOURNAL
Debits Credits
PROPRIETARY
OPERATING/PROGRAM EXPENSES 183,000
8. PROPRIETARY
ACCOUNTS PAYABLE 189,000
ACCRUED FUNDED PAYROLL AND
BENEFITS 183,000
DISBURSEMENTS IN TRANSIT⎯2017 372,000
Chapter 17 – Accounting and Reporting for the Federal Government
17–24
Ch. 17, Solutions, 17-21 (Cont’d)
FLOOD CONTROL COMMISSION
GENERAL JOURNAL
Debits Credits
OPERATING/PROGRAM EXPENSES 60,000
OPERATING MATERIALS AND SUPPLIES 60,000
10. BUDGETARY
EXPENDED AUTHORITY⎯2017 788,000
OTHER APPROP. REALIZED⎯2017 788,000
PROPRIETARY
CUMULATIVE RESULTS OF OPERATIONS 495,500
Chapter 17 – Accounting and Reporting for the Federal Government
17–25
Ch. 17, Solutions, 17-21 (Cont’d)
b. FLOOD CONTROL COMMISSION
BALANCE SHEET
OCTOBER 31, 2017
ASSETS
INTRAGOVERNMENTAL:
FUND BALANCE WITH TREASURY⎯2017 $6,458,000
GOVERNMENTAL:
LIABILITIES
ACCOUNTS PAYABLE $ 216,000
NET POSITION
UNEXPENDED APPROPRIATIONS 6,212,000
Chapter 17 – Accounting and Reporting for the Federal Government
17–26
Ch. 17, Solutions, 17-21 (Cont’d)
c. FLOOD CONTROL COMMISSION
STATEMENT OF CHANGES IN NET POSITION
FOR THE MONTH ENDED OCTOBER 31, 2017
CUMULATIVE
RESULTS OF
OPERATIONS
UNEXPENDED
APPROPRIATIONS
BEGINNING BALANCES
$ 0
$ 0
BUDGETARY FINANCING SOURCES:
APPROPRIATIONS RECEIVED
7,000,000
APPROPRIATIONS USED
788,000
(788,000)
TOTAL FINANCING SOURCES
788,000
6,212,000
NET COST OF OPERATIONS (Note A)
(495,500)
_________
ENDING BALANCES
$ 292,500
$6,212,000
Note A: Operating/program expenses of $493,000 + depreciation and
amortization of $2,500.
Chapter 17 – Accounting and Reporting for the Federal Government
17–27
Ch. 17, Solutions, 17-21 (Cont’d)
d. FLOOD CONTROL COMMISSION
STATEMENT OF BUDGETARY RESOURCES
FOR MONTH ENDED OCTOBER 31, 2017
BUDGETARY RESOURCES:
BUDGET AUTHORITY (Note A)
$7,000,000
STATUS OF BUDGETARY RESOURCES:
OBLIGATIONS INCURRED (Note B)
$ 970,000
UNOBLIGATED BALANCES AVAILABLE (Note C)
6,030,000
TOTAL STATUS OF BUDGETARY RESOURCES
$7,000,000
CHANGE IN OBLIGATED BALANCE:
OBLIGATIONS INCURRED
970,000
OUTLAYS (Note D)
(542,000)
OBLIGATED BALANCE, END OF PERIOD (Note E)
$ 428,000
Note A: Total budgetary resources are the total appropriations for the year, or
$7,000,000.
Note B: Obligations incurred equals expended budgetary authority of $788,000
(see Entry 10A) plus the remaining balance of Undelivered
Orders⎯2016 of $182,000 ($970,000 – $788,000), or $970,000. In this
case, since the Flood Control Commission obligates prior to all
expenditures of budgetary authority, the amount incurred also is
simply the amount obligated by the credit to Undelivered Orders⎯2017
(see Entry 4).
Note C: Total budgetary resources of $7,000,000 less amount obligated of
$970,000 (see Note B) equals $6,030,000.
Note D: Outlays also equals the decrease in Fund Balances with the U.S.
Treasury during the period⎯the equivalent of cash disbursed.
Note E: Obligated balances at year-end include Undelivered Orders ($182,000)
and Accounts Payable and other accrued liabilities ($246,000), or
$428,000 in total.
General Problem Information: Transaction analysis and statements
Chapter 17 – Accounting and Reporting for the Federal Government
17–28
Ch. 17, Solutions (Cont’d)
17-22.
a. FINANCIAL CAPABILITY
(1) INDIVIDUAL INCOME TAXES/TOTAL REVENUES: 77.3%
($2,196.4/$2,842.5)
(2) DEBT SERVICE ($7,444.0+$248.7/$2,842.5): 270.6%
d. All but one measure indicates that the federal government is in poor financial
condition. Although the quick ratio is well over one using just the Accounts
Chapter 17 – Accounting and Reporting for the Federal Government
17–29
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Ch. 17, Solutions, 17-22 (Cont’d)
costs are covered by current period revenues. Finally, the negative net
position indicates that there are no reserves on which to draw to help address
the interperiod equity situation. The financial statements of the federal
government reflect the financial concerns expressed by Congress, the
President, Watchdog groups, and citizens.
General Problem Information: Financial statement analysis of the federal government
Learning Objective: 17-3
Topic: Required Financial Reporting—U.S. Government-wide
Bloom’s Taxonomy: Analyze
Accreditation Skills tag: AACSB: Analytical Thinking, AICPA: FN: Decision Making
Level of Difficulty: Hard