Prepare journal entries for a local government to record the following transacti
ID: 1187935 • Letter: P
Question
Prepare journal entries for a local government to record the following transactions, first for fund financial statements and then for government-wide financial statements.
Equipment for the fire department is received with a cost of $12,000. When it was ordered, an anticipated cost of $11,800 had been recorded.
A state grant of $90,000 is awarded to supplement police salaries. The money will be paid to reimburse the government after the supplements have been paid to the police officers.
Property tax assessments are mailed to citizens of the government. The total assessment is $600,000, although officials anticipate that 4 percent will never be collected. There is an enforceable legal claim for this money and the government can use it immediately.
Prepare journal entries for a local government to record the following transactions, first for fund financial statements and then for government-wide financial statements.
a. The government sells $900,000 in bonds at face value to finance construction of a warehouse. b. A $1.1 million contract is signed for construction of the warehouse. The commitment is required if allowed. c. A $130,000 transfer of unrestricted funds was made for the eventual payment of the debt in (a). d.
Equipment for the fire department is received with a cost of $12,000. When it was ordered, an anticipated cost of $11,800 had been recorded.
e. Supplies to be used in the schools are bought for $2,000 cash. The consumption method is used. f.A state grant of $90,000 is awarded to supplement police salaries. The money will be paid to reimburse the government after the supplements have been paid to the police officers.
g.Property tax assessments are mailed to citizens of the government. The total assessment is $600,000, although officials anticipate that 4 percent will never be collected. There is an enforceable legal claim for this money and the government can use it immediately.
Explanation / Answer
34. FUND-BASED FINANCIAL STATEMENTS
a. Capital Projects Fund
Cash 300,000
Other Financing Sources-Bonds Proceeds 300,000
b. Capital Projects Fund
Encumbrances 400,000
Fund Balance-Reserved For Encumbrances 400,000
c. General Fund
Other Financing Uses-Transfers Out 20,000
Cash 20,000
Debt Service Fund
Cash 20,000
Other Financing Sources-Transfer In 20,000
d. General Fund
Fund Balance-Reserved for Encumbrances 11,800
Encumbrances 11,800
Expenditures Control-Machinery and Equipment 12,000
Vouchers Payable 12,000
e. General Fund
Inventory of Supplies 2,000
Cash 2,000
f. Special Revenue Fund
Cash 5,000
Deferred Revenues 5,000
g. General Fund
Taxes Receivable 600,000
Revenues Control 576,000
Allowance for Uncollectible Current Taxes 24,000
GOVERNMENT-WIDE FINANCIAL STATEMENTS
a. Governmental Activities
Cash 300,000
Bonds Payable 300,000
b. No entry
c. No entry
d. Governmental Activities
Machinery and Equipment 12,000
Vouchers or Accounts Payable 12,000
e. Governmental Activities
Inventory of Supplies 2,000
Cash 2,000
f. Governmental Activities
Cash 5,000
Deferred Revenues 5,000
g. Governmental Activities
Taxes Receivable 600,000
Revenues Control 576,000
Allowance for Uncollectible Current Taxes 24,000