3-14
Chapter 3, Solutions (Cont’d)
3-20. Town of Willingdon
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
ESTIMATED REVENUES 16,650,000
Learning Objective: 3-4
Topic: Recording the budget
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application
3-15
Ch. 3, Solutions (Cont’d)
3-21. Town of Willingdon
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
a. ENCUMBRANCES⎯2017 1,365,000
purchase orders and contracts to have a clear understanding of what
transactions are in process that will result in the acquisition of assets, the
incurring of expenses, and the incurring of liabilities.
3-16
Chapter 3, Solutions, 3–21 (Cont’d)
3-22.
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
a. ESTIMATED REVENUES 2,700,000
3-17
Chapter 3, Solutions, 3–22 (Cont’d)
b.
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
1. CASH 43,000
REVENUES 43,000
2. ENCUMBRANCES—2017 29,900
ENCUMBRANCES
OUTSTANDING—2017 29,900
3. ENCUMBRANCES
OUTSTANDING—2017 29,100
ENCUMBRANCES—2017 29,100
3-18
Ch. 3, Solutions, 3–22 b. 3. (Cont’d)
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
Expenditures Ledger:
GENERAL GOVERNMENT 7,300
c. CALCULATION OF BUDGETED BUT UNREALIZED REVENUES
AS OF JULY 31, 2016
UNREALIZED
SOURCE BUDGETED ACTUAL REVENUE
PROPERTY TAXES $1,900,000 $ -0- $1,900,000
3-19
Ch. 3, Solutions, 3-22 (Cont’d)
d. CALCULATION OF AVAILABLE APPROPRIATIONS, AS OF JULY 31, 2016
AVAILABLE
APPROPRIATIONS ENCUMBRANCES EXPENDITURES APPROPRIATIONS
GENERAL GOVERNMENT $ 500,000 $ -0- $ 7,300 $ 492,700
General Problem Information: Recording budgetary and operating transactions
Learning Objective: 3-1, 3-3, 3-4
Topic: Budgetary Control of Encumbrances and Expenditures
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application
Level of Difficulty: Medium
3-20
Ch. 3, Solutions (Cont’d)
3-23. City of Augusta
a. Estimated revenues total $900,000, while appropriations total $895,000 (the
2. $12,500 (entry 103 to Intergovernmental Revenue)
3. Increased
2. Totaling the Revenues column equates to $225,000; while expenditures to
city has authorizations to spend $895,000, of which $205,000 has been spent
3-24. Lincoln City
a. Apparently, Lincoln City uses a 10-digit account number structure having
three segments. As is customary, the first segment is the fund code, with
01 representing the General Fund. As the heading implies, the second
3-21
Ch. 3, Solutions, 3-24a (Cont’d)
b. Encumbrance control procedures are generally used only for purchases of
goods and services for which there is delay between placing the order or
c. At the mid-point of FY 2016, the Culture and Recreation Department has
expended or encumbered the following percentages of its appropriations:
3-22
Ch. 3, Solutions, 3-24c (Cont’d)
usage patterns would be required, however, to confirm if the spending rate
is too rapid for these accounts. Larger quantities of materials and supplies
d. It may appear that the Personnel Services, Conferences and Training, and
Capital Outlay accounts could get by with lower appropriations. This is
likely not the case, however, since departments typically have to defend
e. Possible explanations for the observed over- and under-spending patterns
3-23
Ch. 3, Solutions, 3-24e (Cont’d)
General Problem Information: Governmental accounting system—departmental budgetary
comparison report
Learning Objective: 3-5
Topic: Accounting Information Systems
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application; AICPA: Critical Thinking
Level of Difficulty: Medium
3-
24
Ch. 3, Solutions (Cont’d)
3-25.
WESTOVER VILLAGE
Statement of Activities (partial)
For the Year Ended June 30, 2017
Net (Expense)
Revenue and
Changes in Net
Assets
Program Revenues
Expenses
Charges for
Services
Capital
Grants
Governmental
Activities
Functions/Programs
Primary Government
General government
$ 9,571
$ 3,146
$ (5,582)
Public safety
34,844
1,198
$ 62
(32,277)
Health and sanitation
6,738
5,612
(1,126)
Culture and recreation
12,352
3,995
(5,907)
Interest on long-term debt
6,068
_______
____
(6,068)
Total governmental activities
$ 69,573
$ 13,951
$ 62
(50,960)
General revenues:
Property taxes
56,300
Unrestricted grants and contributions
1,200
Investment earnings
1,958
Total general revenues
59,458
Special item—gain on sale of park land
3,473
Total general revenues and special
items
62,931
Change in net position
11,971
Net position—July 1, 2016
1,643
Net position—June 30, 2017
$13,614
3-
25
General Problem Information:
Government-wide Statement of
Activities
Learning Objective: 3-1
Topic: Classification of Estimated
Revenues and Revenues
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB:
Knowledge Application,
AICPA: FN Reporting
Level of Difficulty: Medium