Chapter 04 – Accounting for Governmental Operating Activities
4-29
Ch. 4, Solutions (Cont’d)
4-24. a. CITY OF HINTON
JOURNAL ENTRIES FY 2017
Debits Credits
General Fund:
(1) ESTIMATED REVENUES 3,140,000
APPROPRIATIONS 3,100,000
BUDGETARY FUND BALANCE 40,000
General Fund:
Chapter 04 – Accounting for Governmental Operating Activities
4-30
Ch. 4, Solutions, 4-24, a (3) (Cont’d)
Debits Credits
Governmental Activities:
TAXES RECEIVABLE⎯CURRENT 2,150,000
ALLOWANCE FOR UNCOLLECTIBLE CURRENT
TAXES 64,500
GENERAL REVENUES—PROPERTY TAXES 2,085,500
General Fund:
Chapter 04 – Accounting for Governmental Operating Activities
4-31
Ch. 4, Solutions, 4-24, a (7) (Cont’d)
Debits Credits
Governmental Activities:
General Fund:
(8) BUDGETARY FUND BALANCE 80,000
ESTIMATED REVENUES 80,000
(THIS ENTRY ADJUSTS THE ORIGINAL BUDGETARY INCREASE OF $40,000 IN
BUDGETARY FUND BALANCE TO A NET DECREASE OF $40,000.)
General Fund:
(9) EXPENDITURES⎯2017 819,490
Governmental Activities:
EXPENSES ⎯(function details omitted) 819,490
General Fund:
(10) EXPENDITURES⎯2017 62,690
DUE TO FEDERAL GOVERNMENT 62,690
Governmental Activities:
Chapter 04 – Accounting for Governmental Operating Activities
4-32
Ch. 4, Solutions, 4-24, a. (Cont’d)
Debits Credits
General Fund:
(11) CASH 947,000
REVENUES 947,000
Governmental Activities:
General Fund and Governmental Activities:
General Fund:
(13) ENCUMBRANCES OUTSTANDING⎯2017 1,988,040
ENCUMBRANCES⎯2017 1,988,040
General Fund:
Chapter 04 – Accounting for Governmental Operating Activities
4-33
Ch. 4, Solutions, 4-24, a (14) (Cont’d)
Debits Credits
Governmental Activities:
VOUCHERS PAYABLE 2,301,660
CASH 2,293,630
EXPENSES⎯(function detail omitted) 8,030
General Fund and Governmental Activities:
General Fund and Governmental Activities:
ALLOWANCE FOR UNCOLLECTIBLE CURRENT
General Fund:
Chapter 04 – Accounting for Governmental Operating Activities
4-34
Ch. 4, Solutions, 4-24 (Cont’d)
Debits Credits
b. CLOSING ENTRIES, APRIL 30, 2017
General Fund:
APPROPRIATIONS 3,100,000
Governmental Activities:
(Not closed here since the governmental activities general ledger includes
Chapter 04 – Accounting for Governmental Operating Activities
4-35
Ch. 4, Solutions, 4-24 (Cont’d)
c.
CITY OF HINTON
GENERAL FUND BALANCE SHEET
AS OF APRIL 30, 2017
ASSETS
CASH $ 486,520
TAXES RECEIVABLE⎯DELINQUENT $413,730
LESS: ALLOWANCE FOR UNCOLLECTIBLE
LIABILITIES AND FUND BALANCES
LIABILITIES:
VOUCHERS PAYABLE $157,390
FUND BALANCES:
NONSPENDABLE—INVENTORY
Chapter 04 – Accounting for Governmental Operating Activities
4-36
Ch. 4, Solutions, 4-24 (Cont’d)
d. CITY OF HINTON
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE
FOR THE YEAR ENDED APRIL 30, 2017
REVENUES
TAXES $2,110,500
INTEREST AND PENALTIES ON TAXES 26,901
OTHER SOURCES 947,000
TOTAL REVENUES 3,084,401
EXPENDITURES
Chapter 04 – Accounting for Governmental Operating Activities
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Ch. 4, Solutions, 4-24, d. (Cont’d)
NOTE: The Governmental Activities general ledger is not shown here.
CITY OF HINTON
General Fund
General Ledger (Not Required)
Cash Interest and Penalties Rec.__ ____
5/1/2016 Bal. 97,000 4-25(9) 618,690 5/1/2016 Bal.26,280 4-25(6) 20,570
Taxes Receivable⎯Current Allow. for Uncoll. Interest & Penalties _
4-25(3) 2,150,000 4-25(6) 1,961,000 5/1/2016 Bal. 11,160
Allow. for Uncoll. Current Taxes Inventory of Supplies_________
4-25(16) 64,500 4-25(3) 64,500 5/1/2016 Bal.16,100
Taxes Receivable⎯Delinquent
5/1/2016 Bal. 583,000 4-25(6) 383,270
Allow. for Uncoll. Delinquent Taxes Vouchers Payable___________
5/1/2016 Bal.189,000 4-25(14) 2,301,660 5/1/2016 Bal 148,500
Chapter 04 – Accounting for Governmental Operating Activities
4-38
Ch. 4, Solutions, 4-24, d. (Cont’d)
Due to Federal Government Revenues____________
4-25(12) 288,580 5/1/2013 Bal. 59,490 4-10. b 3,084,401 4-25(3) 2,085,500
Due to State Government Expenditures⎯2017_________
4-25(12) 34,400 4-25(9) 34,400 4-10 (2) 10,000 4-25(14) 8,030
Tax Anticipation Notes Payable
Fund Balance—Nonspendable—
Fund Balance—Unassigned ____Inventory of Supplies _
5/1/2016 Bal. 298,130 5/1/2016 Bal. 16,100
Appropriations Encumbrances Outstanding⎯2017___
Budgetary Fund Balance
General Problem Information: Operating transactions and General Fund balance sheet
Learning Objective: 4-1
Learning Objective: 4-2
Learning Objective: 4-3
Topic: Various chapter topics
Bloom’s Taxonomy: Apply
Accreditation Skills tag: Knowledge Application, AICPA: FN Reporting
Level of Difficulty: Medium
Chapter 04 – Accounting for Governmental Operating Activities
Ch. 4, Solutions (Cont’d)
4-25. a CITY OF FOUNTAINS
PONCE DE LEON ENDOWMENT FUND
GENERAL JOURNAL
FOR YEAR ENDED JUNE 30, 2017
Debits Credits
1. DECEMBER 31, 2016:
2. DECEMBER 31, 2016:
3. JUNE 30, 2017:
CASH 37,000
4. JUNE 30, 2017:
5. JUNE 30, 2017:
INVESTMENT IN BONDS 3,300
Chapter 04 – Accounting for Governmental Operating Activities
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Ch. 4, Solutions, 4-25, a. (Cont’d)
ADJUSTING ENTRIES: NONE REQUIRED.
CLOSING ENTRIES:
Debits Credits
REVENUES—CONTRIBUTIONS FOR
ENDOWMENT 1,500,000
REVENUES—CHANGE IN FAIR VALUE
b. (1) CITY OF FOUNTAINS
PONCE DE LEON ENDOWMENT FUND
BALANCE SHEET
AS OF JUNE 30, 2017
ASSETS
CURRENT ASSETS:
CASH $ 93,700
TOTAL CURRENT ASSETS 93,700
INVESTMENTS:
Chapter 04 – Accounting for Governmental Operating Activities
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Ch. 4, Solutions, 4-25, b. (Cont’d)
(2) CITY OF FOUNTAINS
PONCE DE LEON ENDOWMENT FUND
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE
FOR YEAR ENDED JUNE 30, 2017
REVENUES RECEIVED FOR CONTRIBUTION TO ENDOWMENT $1,500,000
REVENUES EARNED FOR TRANSFER TO
EXPENDABLE TRUST FUND:
INTEREST ON BONDS $12,000
INTEREST ON CERTIFICATE OF DEPOSIT 25,000
c. The fund is a permanent fund, more specifically a public interest trust fund.
Permanent funds that are nonexpendable usually do not require budgetary
Topic: Permanent Funds
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application; AICPA: Critical Thinking, FN
Reporting
Level of Difficulty: Medium