The City of Richmond maintains a Public Employee Retirement Trust Fund for its p
ID: 2581448 • Letter: T
Question
The City of Richmond maintains a Public Employee Retirement Trust Fund for its public safety employees. During the year ended June 30, 2017, the following transactions occurred: I. The City contributed S 1,200,000 in cash to the plan. Employee members contributed an additional S1,200,000 2. Annuity benefits in the amount of $255,000 were recorded as liabilities. 3. Annuity benefits, previously recorded as liabilities, were paid in cash in the amount of $207,000. 4. Investmen accrued at year-end. 5. Additional investments in the amount of $2,100,000 were purchased. 6. The market value of investments decreased by $9,100. 7. Nominal accounts for the year were closed t income received in cash amounted to $102,000. In addition, $16,000 in interest receivable was Required: Prepare journal entries for the above transactions on the books of the City of Richmond Public Safety Employee Retirement Trust Fund.Explanation / Answer
Journal Entries S.No. Date Account Name Debit Credit 1 30/06/2017 Employer's Contribution to Plan A/c $ 1,200,000 Employee's Contribution to Plan A/c $ 1,200,000 To Plan Payable A/c $ 2,400,000 30/06/2017 Plan Payable A/c $ 2,400,000 To Cash A/c $ 2,400,000 2 30/06/2017 Annuity Benefis Expenses A/c $ 255,000 To Annuity Benefit Liability A/c $ 255,000 3 30/06/2017 Annuity Benefit Liability A/c $ 207,000 To Cash A/c $ 207,000 4 30/06/2017 Cash A/c $ 102,000 To Investment A/c $ 102,000 30/06/2017 Accrued Innterest Income A/c $ 16,000 To Interst A/c $ 16,000 5 30/06/2017 Investment A/c $ 2,100,000 To Cash/Bank A/c $ 2,100,000 6 30/06/2017 Unrealised holding Loass A/c $ 9,100 To Investment A/c $ 9,100 7 30/06/2017 Interst A/c $ 16,000 To Income Summary A/c $ 16,000