Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
3-15
Ch. 3, Solutions (Cont’d)
3-23. TOWN OF WILLINGDON
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
a. ENCUMBRANCES⎯20xx 1,365,000
ENCUMBRANCES
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
3-16
Chapter 3, Solutions, Exercise 3-23 (Cont’d)
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: FN Measurement &
Reporting
Level of Difficulty: Medium
3-24.
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
a. ESTIMATED REVENUES 2,700,000
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
3-17
Chapter 3, Solutions, Exercise 3-24 (Cont’d)
b.
General Ledger Subsidiary Ledger
Debits Credits Debits Credits
1. CASH 43,000
REVENUES 43,000
2. ENCUMBRANCES—20xx 29,900
ENCUMBRANCES
OUTSTANDING—20xx 29,900
3. ENCUMBRANCES
OUTSTANDING—20xx 29,100
ENCUMBRANCES—20xx 29,100
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
3-18
Ch. 3, Solutions, Exercise 3-24 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
UNREALIZED
SOURCE BUDGETED ACTUAL REVENUE
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
3-19
Ch. 3, Solutions, Exercise 3-24 (Cont’d)
d. CALCULATION OF AVAILABLE APPROPRIATIONS, AS OF JULY 31
AVAILABLE
APPROPRIATIONS ENCUMBRANCES EXPENDITURES APPROPRIATIONS
GENERAL GOVERNMENT $ 500,000 $ -0- $ 7,300 $ 492,700
General Problem Information: Recording General Fund operating budget and operating transactions
Learning Objective: 3-5
Topic: Budgetary Control of Encumbrances and Expenditures
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: FN Measurement
Level of Difficulty: Medium
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
3-20
Ch. 3, Solutions (Cont’d)
3-25. CITY OF AUGUSTA
a. Estimated revenues total $900,000, while appropriations total $860,000 (the
2. Intergovernmental Revenues (entry 103) was adjusted by $12,500 in the
3. Decreased. Both Estimated Revenues and Appropriations were
c. 1. There is a debit balance in the three Revenues ledger accounts totaling
2. Totaling the Revenues column equates to $225,000; the one
3. Of the $912,500 estimated revenues (original budget plus amendment),
$225,000 has been recognized and $687,500 remains to be recognized.
The city has authorizations to spend $910,000, of which $1,700 is
3-21
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Chapter 3, Solutions (Cont’d)
3-26. LINCOLN CITY
a. Encumbrance control procedures are generally used only for purchases of
goods and services for which there is delay between placing the order or
contract and receipt of the goods or services. Recurring expenditure
Other 72.1%
At first glance, it appears that the Materials and Supplies, Contractual
Services, and Other accounts could expend their appropriations well before
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
3-22
Chapter 3, Solutions, Exercise 3-26 b. (Cont’d)
c. 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 justify
d. Possible explanations for the observed over- and under-spending patterns
have been provided in parts b and c. These explanations make it clear that
General Problem Information: Departmental budgetary comparison report
Learning Objective: 3-3
Topic: Reporting Budgeted and Actual Results
Bloom’s Taxonomy: Analyze
Accreditation Skills tag: AACSB: Knowledge Application; AICPA: BB Critical
Thinking
Level of Difficulty: Hard
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
23
Ch. 3, Solutions (Cont’d)
3-27.
WESTOVER VILLAGE
Statement of Activities (partial)
For the Year Ended June 30, 2020
Net (Expense)
Revenue and
Changes in Net
Assets
Program Revenues
Functions/Programs
Expenses
Charges for
Services
Operating
Grants
Governmental
Activities
Primary Government
General government
$ 9,571
$ 3,146
$ 843
$ (5,582)
Public safety
34,844
1,198
1,307
(32,277)
Health and sanitation
6,738
5,612
(1,126)
Culture and recreation
12,352
3,995
2,450
(5,907)
Interest on long-term debt
6,068
_______
_____
(6,068)
Total governmental activities
$ 69,573
$ 13,951
$ 4,600
(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, 2019
1,643
Net position—June 30, 2020
$ 13,614
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
24
Ch. 3, Solutions, Exercise 3-27 (Cont’d)
General Problem Information: Government-wide statement of activities
Learning Objective: 3-1
Topic: Classification and Reporting of Expenses and Revenues at the Government-wide Level
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: FN Reporting
Level of Difficulty: Medium
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
25
Ch. 3, Solutions (Cont’d)
3-28.
a.
CITY OF GREENVILLE
General Fund
Statement of Revenues, Expenditures, and Changes in Fund Balances
for the Fiscal Year (amounts in thousands)
Revenues:
Taxes
$ 6,051
Fines and forfeits
308
Intergovernmental revenue
500
Charges for services
366
Total Revenues
7,225
Expenditures:
General government
$ 1,622
Public safety
3,361
Public works
1,443
Culture and recreation
718
Total Expenditures
7,144
Other Financing Sources and (Uses)
Interfund transfer out
(50)
Change in Fund Balances
31
Fund Balances, January 1
152
Fund Balances, December 31
$ 183
Chapter 03 – Governmental Operating Statement Accounts; Budgetary Accounting
Ch. 3, Solutions, Exercise 3-28 (Cont’d)
b. CITY OF GREENVILLE
General Fund
Schedule of Revenues, Expenditures, and Changes in Fund Balances—Budget and Actual
for the Fiscal Year (amounts in thousands)
Budgeted Amounts
Actual Amounts
Variance with Final
Original
Final
Budget Basis
Budget Over(Under)
Revenues
Taxes
$ 6,048
$ 6,048
$ 6,051
$ 3
Fines and forfeits
303
303
308
5
Intergovernmental revenue
500
500
500
–
Charges for services
370
370
366
(4)
Total revenues
7,221
7,221
7,225
4
Expenditures and Encumbrances
General government
1,635
1,635
1,630
(5)
Public safety
3,375
3,375
3,372
(3)
Public works
1,448
1,448
1,446
(2)
Culture and recreation
724
724
718
(6)
Total Expenditures
7,182
7,182
7,166
(16)
Excess of revenues over expenditures
39
39
59
20
Other Financing Sources and (Uses)
Interfund transfers out
50
50
50
–
Excess of revenues over expenditures and
other financing sources
(11)
(11)
9
20
Increase in encumbrances outstanding
–
–
22
22
Increase in fund balances for the year
(11)
(11)
31
42
Fund balances, January 1
152
152
152
–
Fund balances, December 31
$ 141
$ 141
$ 183
$ 42
27