7-20
(c)
City of Arlington
Enterprise Fund
Municipal Airport Fund
Statement of Revenues, Expenses, and Changes in Fund Net Position
For the Year Ended June 30, 2013
Operating revenues:
Airline rental revenue, net of $10,000 estimated uncollectible
Operating expenses:
Salaries expense $200,000
Nonoperating revenues and expenses:
Interest revenue 165,000
7-21
(d)
City of Arlington
Enterprise Fund
Municipal Airport Fund
Statement of Net Position
June 30, 2013
Assets
Current assets:
Cash $1,082,500
Fixed Assets:
Land 19,000,000
Liabilities
Current liabilities:
Accounts payable 4,000
Long-term liabilities:
Advance from General Fund 1,500,000
7-22
7-23
P7-5 (moderate, 60 minutes)
a.
Total ending net assets
Revenue from rentals
800,000
Personal services expense
380,000
Utilities expense
63,000
b.
Net capital assets
Land
900,000
Equipment
325,000
Buildings
Accumulated depreciation—equipment
Accumulated depreciation—buildings
Less revenue bonds payable
c.
Restricted assets
Cash—restricted for debt service
150,000
Cash–restricted for customer deposits
23,000
173,000
Liabilities payable from restricted assets
Customers’ deposits payable
150,000
Depreciation expense—equipment
15,000
Depreciation expense—building
50,000
Interest expense
40,030
Uncollectible accounts expense
Supplies expense
601,030
198,970
Plus beginning net assets
d.
Net assets, unrestricted
Equals net assets, unrestricted
7-25
P7-6 (Moderate, 75 minutes)
Transactions and events for 2012:
2. Capital assets not being depreciated 1,000,000
Cash 1,000,000
4. Interest expense 100,000
Transactions and events for 2013:
2. Cash 60,000
Deferred income 60,000
4. Salaries expense 125,000
5. Revenue bonds payable 250,000
6. Interest expense 95,000
7. Depreciation expense 200,000
7-26
Village of Katonah
Enterprise Fund
Katonah Metro Parking Fund
Statement of Revenues, Expenses, and Changes in Net Position
For the Year Ended December 31, 2013
Nonoperating (expenses):
Interest expense (195,000)
Village of Katonah
Enterprise Fund
Katonah Metro Parking Fund
Statement of Net Position
December 31, 2013
Assets
Current assets – cash $ 150,000
Noncurrent assets:
Liabilities
Current liabilities:
Deferred income 60,000
Net Position
Invested in capital assets, net of related debt 50,000
P 7-7 (Moderate, 20 minutes)
1. Under the accrual basis of accounting, revenues should be recognized in the
accounting period in which they are earned and become measurable.
2. For the General Fund, the modified accrual basis of accounting should be
used because it is a governmental fund, which is, in essence, an
accounting segregation of current financial resources.
For Special Revenue Funds, the modified accrual basis of accounting
should be used because it is a governmental fund, which is, in essence, an
accounting segregation of current financial resources.
7-28
3. In the General Fund, fixed assets and long-term liabilities should not be
recorded in the fund financial statements because the current financial
resources approach is followed and, therefore, only current assets and
liabilities are accounted for in this fund.
P 7-8 (Moderate, 10 minutes)
Estimated cost of paper consumed during the year $55,000
P7-9 (Somewhat difficult, 30 minutes)
1. March 1, 2013
Revenue bonds payable 100,000
September 1, 2013
2. RRT should report claims expense and a claims liability of $5,000. Under accrual
accounting, contingent liabilities should be accrued if risk of loss has not been transferred
3. RRT should make this journal entry:
RRT should recognize revenue on receipt of this grant because it met all eligibility
4. RRT should make the following journal entries:
Cash 500,000
P7–10
(a)
1. Cash 1,500,000
2. Land 500,000
3. Cash 3,000,000
4. No entry.
5. Improvements other than buildings 400,000
Buildings 1,400,000
6. Vouchers payable 1,710,000
7-30
7. Improvements other than buildings 600,000
Buildings 900,000
8. Vouchers payable 1,425,000
9. Buildings 700,000
10. Vouchers payable 665,000
11. Retainage payable 200,000
12. Equipment 300,000
13. Inventory 12,000
14. Cash 214,000
15. Operating expenses—cost of sales and services 134,200
Cash 48,000
7-31
16. Nonoperating expense—interest on revenue bonds 120,000
17. Nonoperating expense—interest on capital lease 7,500
18. Nonoperating expense—interest on capital lease 7,206
19. Cash 391,200
20. Operating expenses—cost of sales and services 156,900
Operating expense-administration 9,000
21. Nonoperating expenses—interest—revenue bonds 100,000
Accrued interest payable 100,000
22. Operating expenses—depreciation 150,000
7-32
23. Capital lease liability (12,339 + 12,647 + 12,963 + 13,287) 51,236
24 Cash restricted for bond principal retirement 300,000
2009 Closing Entry:
City of Paradise Falls
Golf Course Enterprise Fund
Statement of Fund Revenues, Expenses, and Changes in Net Position
For the Year Ended December 31, 2013
579,000
605,200
450,100
155,100
237,008
7-34
35
City of Paradise Falls
Golf Course Enterprise Fund
Statement of Net Position
December 31, 2013
Assets
Current assets
Capital assets
Land
500,000
Equipment
300,000
Less accumulated depreciation
(30,000)
270,000
Improvements other than buildings
Less accumulated depreciation
950,000
Buildings
Less accumulated depreciation
(70,000)
Net capital assets
4,650,000
Total assets
4,985,612
Liabilities and net position
Current liabilities
Accrued interest payable
102,302
Vouchers payable
12,000
Current portion of capital lease liability
51,236
Due to Special Revenue Fund
8,000
Due to Water Enterprise Fund
160,000
Due to General Fund
9,000
Total current liabilities
Noncurrent liabilities
Capital lease payable, net of current portion
224,982
Revenue bonds payable
Cash
28,712
Inventory
Total current assets
Noncurrent assets
Restricted cash
7-36
Net position
SUMMARY PROBLEM
(1)
2. Cash 4,500
Accounts receivable 4,500
4. Due from General Fund 200
Revenues – electricity billings 200
6. Salaries expense 1,300
7. Serial bonds payable 2,000
8. Cash 1,050
9. Interest expense 240
Accrued interest payable 240
11. Serial bonds payable 2,000
Current portion of serial bonds payable 2,000
37
Leisure City
Enterprise Fund
EUEF
Trial Balance
December 31, 2013
(in thousands of dollars)
Debits Credits
Cash $ 3,310
(2)
Leisure City
Enterprise Fund
EUEF
Statement of Revenues, Expenses, and Changes in Net Position
For the Year Ended December 31, 2013
(in thousands of dollars)
Operating revenues:
Electricity billings, net of $40 estimated uncollectible
accounts $ 4,160
Operating expenses:
Leisure City
Enterprise Fund
EUEF
Statement of Net Position
December 31, 2013
(in thousands of dollars)
Assets
Noncurrent assets:
Capital assets, net of $15,600 accumulated depreciation 32,400