Solution manual advanced accounting 10e by fischer taylor CH16

To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com CHAPTER 16 UNDERSTANDING THE ISSUES can be used to finance government programs, then a special revenue fund is used If only the earnings can be spent, a permanent fund is used Capital projects funds are used to account for the inflows and outflows of financial resources raised and expended to acquire major capital assets used by the general government This accounting is in accordance with the flows of financial resources measurement focus adopted for governmental funds Fixed assets acquired with proceeds from general obligation bonds are accounted for in the general fixed assets account group subsequent to acquisition Two major types of interfund transfers are operating transfers and equity transfers Operating transfers are of a frequent and recurring nature and record billings for goods or services provided, or transfers between funds for such items as debt servicing, financing of specific programs, or funding of major construction projects Equity transfers are infrequent and often nonrecurring These transfers are often in conjunction with the initiating or closing of a fund Operating or equity transfers between governmental funds use “other financing sources” and “other financing uses” accounts Operating transfers between proprietary funds and governmental funds or between two proprietary funds are recorded as revenues and expenditures/expenses Equity transfers between governmental funds and proprietary funds are recorded as interfund transfers (in proprietary funds) and other financing sources or uses (in governmental funds) Closing of a capital projects fund at the end of a period is desirable to adjust and balance the fund accounts for the annual preparation of the financial statements As part of this process, the fund balance, unreserved, undesignated is determined This amount is the balance available for completion of the project Also, the total amount of expenditures on a project is determined, which is recorded in the general fixed assets account group as the cost of a completed asset or as Construction in Progress Capital special assessments are levied in installments to provide more time over which to spread collections Only the portion available in the current period is recognized as revenue Recognition of revenue must be deferred for those installments to be collected in future periods Both an agency fund and a trust fund are fiduciary funds An agency fund is adopted when the fiduciary responsibility is short term and all funds received are expendable A trust fund is used when the fiduciary responsibility is of a longer duration The due date and amounts of principal and interest payments are known No useful data would be produced by using budgetary accounts Both are proprietary funds An enterprise fund is used to account for activities of a government that provides goods or services to the public An internal service fund is used to account for activities providing goods or services to other departments within the same governmental unit Revenues would be credited if resources were received from a source outside of the governmental unit that need not be repaid An example is a property tax levy If repayment is required, as in the case of a bond issue, the credit is to Other Financing Sources The latter account is also used for amounts received from other funds of the same governmental unit if that unit had previously recorded the resources as revenue The procedure prevents recognizing the same resources twice as revenue 10 Expenses are the expiration of economic resources Expenditures are the expiration of financial resources Proprietary funds record expenses using accrual accounting Governmental funds record expenditures using modified accrual accounting Both funds account for public-purpose trusts If the resources and any earnings on investments 681 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com accrual basis of accounting They account for their own assets (including fixed assets and depreciation) and liabilities (including long-term debt) Proprietary funds also differentiate between contributed and earned equity, just as a corporation would 11 The accounting emphasis for governmental funds emphasizes the funds available, spendable resources, and their expenditures Modified accrual accounting is required The accounting for proprietary funds, however, emphasizes expenses rather than expenditures and is similar to that for a private enterprise Proprietary funds measure net income, focusing on the total cost of services and the amounts of cost recovered by revenue Proprietary funds are accounted for with a capital maintenance measurement focus, using the 12 Private-purpose trust funds are used to account for assets held by the government on behalf of an individual, group, or organization Permanent funds record assets held, income from which will benefit the government activities 682 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises EXERCISES EXERCISE 16-1 (1) a The cash flow statement for governmental proprietary funds and nonexpendable trust funds has four parts Cash from operations, cash from capital financing activities, cash from noncapital financing activities, and cash from investing activities (2) a The general fund uses modified accrual Enterprise funds recognize revenue when earned under full accrual accounts (3) b Accounting procedures of internal service funds resemble commercial accounting Thus, all costs for operating the fund as well as asset replacement and expansion should be covered (4) d Payments for services provided by an internal service fund within the same governmental entity are considered quasi-external transactions Therefore, they are recognized as operating revenues (5) c As an interest adjustment factor, the premium should be transferred to the debt service fund that pays the interest (6) c Item A is debt service, B is in the trust fund, and D is within the proprietary fund (7) a The entry for reinstatement is: Encumbrances Fund Balance—Unreserved, Undesignated (8) b XXX XXX This is one of two reclassification entries: Deferred Revenues Revenues XXX XXX (9) a Governmental funds not report cash flows since the amounts reported using modified accrual are near cost (10) c The revenue is recorded by the general fund, but the debt service fund makes the payment of principal and interest EXERCISE 16-2 (1) d The debt service fund follows general fund procedures except for the usual practice of not using budgetary entries (2) a Permanent funds are used to account for public-purpose trusts, for which earnings are expendable for a specific purpose Permanent funds are classified as governmental funds (3) a Permanent funds are classified as governmental and follow accounting rules similar to general funds 683 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises Exercise 16-2, Concluded (4) d Capital projects funds are used to account for major construction activity financed by general tax revenues or special assessments (5) a An investment trust fund is used to account for assets, liabilities, net assets, and changes in net assets of external participants in an investment pool managed by the government (6) a Debt service funds are used to account for the payment of interest and principal on general government long-term debt, not short-term debt or the debt of proprietary funds (7) b The agency fund internally distributes monies to recipient funds (8) b With no commitment by the governmental unit, the liability is solely that of the assessed property owners However, the amount of the bond liability may be shown in the notes to the financial statements (9) d This is the typical entry to record a year’s capitalizable costs of an unfinished capital project (10) c The amount to be provided is reduced with the receipt of available funds in the debt service fund EXERCISE 16-3 (1) a Interest is recorded only in the period that interest is due (2) b The capital projects fund receives the proceeds and records the applicable expenditures (3) c All long-term debt that is the responsibility of the city (except debt of proprietary funds) is recorded here (4) d Expenditures are closed at year-end in the capital projects fund The amount spent to date is recorded in an “in-progress” account in the general fixed assets account group 684 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises EXERCISE 16-4 Fund or Account Group (a) Entries Debit Credit Capital Projects Fund Estimated Other Financing Sources Appropriations Budgetary Fund Balance To record budgeted amounts for city hall construction project General Fund The general fund budgetary entry would include $6,000,000 in Estimated Other Financing Uses General Fund Other Financing Uses Cash To record contribution to capital projects fund 6,000,000 6,000,000 Capital Projects Fund Cash Other Financing Sources To record contribution from the general fund 6,000,000 6,000,000 Capital Projects Fund Cash Expenditures Other Financing Uses Other Financing Sources To record proceeds from the sale of bonds 29,700,000 50,000 250,000 30,000,000 General Long-Term Debt Amount to Be Provided for Payment of Serial Bonds Serial Bonds Payable To record liability for the serial bonds 30,000,000 30,000,000 (d) Capital Projects Fund Encumbrances Fund Balance—Reserved for Encumbrances To record signing of construction contract 35,500,000 35,500,000 (e) Capital Projects Fund Fund Balance—Reserved for Encumbrances Encumbrances To record liquidation of encumbrances 10,000,000 10,000,000 Expenditures Cash To record expenditures for partial completion 10,000,000 10,000,000 Construction in Progress Investment in General Fixed Assets— Capital Projects Fund(s) To record partial completion of city hall project 10,000,000 (b) (c) General Fixed Assets Account Group 685 36,000,000 14,000,000 22,000,000 10,000,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises EXERCISE 16-5 Cash Other Financing Sources To record cash receipt from the general fund 40,000 Cash Other Financing Sources To record bonds issued 360,000 Encumbrances Fund Balance—Reserved for Encumbrances To record purchase orders placed and signing of contract 400,000 Fund Balance—Reserved for Encumbrances Encumbrances To reverse encumbrances 400,000 Expenditures Contracts Payable Vouchers Payable* To record actual liabilities of project 399,000 Contracts Payable Vouchers Payable* Contracts Payable—Retained Percentage Cash To record payments and retained percentage 325,000 74,000 40,000 360,000 400,000 400,000 325,000 74,000 30,000 369,000 *Vouchers payable could be used for the entire $399,000 EXERCISE 16-6 Fund or Account Group Date Entries Debt Jan Special Assessments Receivable (current) Service Special Assessments Receivable (deferred) Revenues Deferred Revenues To record receivables from special assessments Debit 90,000 270,000 90,000 270,000 June 30 Cash Special Assessments Receivable (current) Revenues (5% × $360,000) To record receipt of payment by owners 63,000 Expenditures Cash To record payment of principal and interest 63,000 686 Credit 45,000 18,000 63,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises Exercise 16-6, Concluded Fund or Account Group Date Entries Debt Dec 31 Cash Service Special Assessments Receivable (current) Revenues (5% × $315,000) To record receipt of payment by owners Expenditures Cash To record payment of principal and interest General Jan Long-Term Debt Amount to Be Provided by Special Assessments Special Assessment Serial Bonds Payable June 30 Special Assessment Serial Bonds Payable and Amount to Be Provided by Special Dec 31 Assessments Debit 60,750 Credit 45,000 15,750 60,750 60,750 360,000 360,000 45,000 45,000 EXERCISE 16-7 (a) No entry is made in the debt service fund (b) Expenditures Matured Bonds Payable Matured Interest Payable (6% × $5,000,000) To record matured items 800,000 (c) Cash Other Financing Sources To record receipt of cash from the general fund 800,000 (d) Cash with Fiscal Agent Cash To record transfer to First Bank 800,000 (e) Matured Bonds Payable Matured Interest Payable Cash with Fiscal Agent To record payments by bank 500,000 291,000 687 500,000 300,000 800,000 800,000 791,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises EXERCISE 16-8 (a) Restricted Assets—Cash for Construction Interfund Transfer from General Fund To record restricted amount received from the general fund 300,000 (b) Accounts Receivable Due from Other Funds Operating Revenues (or Billings for Services) To record billings 220,000 67,000 (c) Cash Due from Other Funds Accounts Receivable To record collections 232,000 (d) Restricted Assets—Revenue Bond Development Cash Revenue Bonds Payable To record bond issuance with restriction on proceeds 700,000 300,000 287,000 42,000 190,000 700,000 (e) No entry Enterprise funds not use budgetary accounts for encumbrances (f) Construction in Progress Contracts Payable from Restricted Assets To record liability for work to date 360,000 (g) Contracts Payable from Restricted Assets Restricted Assets—Revenue Bond Development Cash To record issuance of check from restricted cash 300,000 360,000 300,000 EXERCISE 16-9 Permanent Fund Cash Revenues To record gift to the city 100,000 Investment in Bonds Cash To record the investment in bonds 100,000 Cash Revenues To record the interest on bonds 7,500 688 100,000 100,000 7,500 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises Exercise 16-9, Concluded Unrealized Loss Investment in Bonds To record fair value adjustment 600 600 Other Financing Uses Cash To record transfer to special revenue fund 6,000 Revenues Other Financing Uses Unrealized Loss Fund Balance To record closing entry 107,500 6,000 6,000 600 100,900 City of Larkin Water Quality Improvement Permanent Funds Balance Sheet December 31, 20X8 Assets Cash Investments Total assets Fund Balance Reserved for endowments EXERCISE 16-10 (1) b (6) g (2) f (7) a (3) d (8) d (4) d (9) i (5) b (10) h 689 Total $ 1,500 99,400 $100,900 $100,900 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Exercises EXERCISE 16-11 (1) g (6) j (2) k (7) d (3) l (8) a (4) l (9) f (5) e (10) b EXERCISE 16-12 (a) GF, GFAAG (b) DSF, CPF, GLTDAG (c) GF, DSF, GLTDAG (d) DSF, GLTDAG (e) CPF, GFAAG (f) PF, SRF (g) ENT, INT, GFAAG, PPT (h) ENT (i) CPF, DSF, GLTDAG, GFAAG 690 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems PROBLEM 16-10 Fund or Date Account Group Entry Jan Capital Estimated Revenues Projects Estimated Other Financing Sources Fund Appropriations ($900,000 × 70%) Budgetary Fund Balance—Unreserved To record budget 10 Estimated revenues: Special assessments County grant 250,000 100,000 Other financing sources: Bond proceeds General fund transfer 500,000 50,000 350,000 550,000 630,000 270,000 Capital Projects Fund Due from County Due from General Fund Revenues Other Financing Sources To record amounts receivable 100,000 50,000 General Fund Other Financing Uses Due to Capital Projects Fund To record required transfer 50,000 Capital Projects Fund Special Assessments Receivable—Current Revenues To record levy of assessments 250,000 Debt Service Fund Special Assessments Receivable—Deferred Deferred Revenues—Special Assessments To record levy of assessments 500,000 Capital Projects Fund Cash Due from County Due from General Fund To record amounts received 150,000 General Fund Due to Capital Projects Fund Cash To record cash transfer 50,000 Capital Projects Fund Encumbrances Fund Balance—Reserved for Encumbrances To record encumbrances 675,000 700 100,000 50,000 50,000 250,000 500,000 100,000 50,000 50,000 675,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-10, Continued Fund or Date Account Group Entry Feb Capital Cash Projects Special Assessments Receivable—Current Fund To record collections 250,000 Mar Cash Other Financing Sources Other Financing Sources—Premium To record bond sale at premium 505,000 Other Financing Uses Cash To record premium to be transferred 5,000 Debt Service Fund Cash Other Financing Sources To record premium due 5,000 General Long-Term Debt Account Group Amount to Be Provided for Payment of Special Assessment Serial Bonds Special Assessment Bonds Payable To record commitment on guaranteed bond issue Capital Projects Fund Investments Cash To record investment 600,000 Capital Projects Fund Other Financing Uses Cash To record transfer for interest 10,000 Debt Service Fund Cash Other Financing Sources To record cash transfer from capital projects fund 10,000 Debt Service Fund Expenditures Cash To record interest payment 15,000 Capital Projects Fund Fund Balance—Reserved for Encumbrances Encumbrances To reverse encumbrances 595,000 Expenditures Contracts Payable Contracts Payable—Retained Percentage To record contractor’s invoice 600,000 1 1 Aug 31 31 Sept Dec 15 Capital Projects Fund 701 250,000 500,000 5,000 5,000 5,000 500,000 500,000 600,000 10,000 10,000 15,000 595,000 540,000 60,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-10, Concluded Fund or Date Account Group Entry Dec 29 Capital Cash Projects Investments Fund Revenues To record partial liquidation of investments 30 30 30 30 Capital Projects Fund 416,600 400,000 16,600 Contracts Payable Cash To record payment to contractor 540,000 Expenditures Vouchers Payable To record vouchers 76,600 Vouchers Payable Cash To record voucher payment 76,600 Debt Service Fund Special Assessments Receivable—Current Special Assessments Receivable— Deferred To reclassify receivables 250,000 Debt Service Fund Deferred Revenues—Special Assessments Revenues To reclassify deferred revenues from special assessments 250,000 General Fixed Assets Account Group Construction in Progress Investment in General Fixed Assets— Capital Projects Funds (special assessments) To capitalize expenditures to date 676,600 540,000 76,600 76,600 250,000 250,000 676,600 PROBLEM 16-11 City of Danville Internal Service Fund Statement of Cash Flows Cash flows from operating activities: Collections (for services) from other funds Wages and salaries paid Purchase of supplies Net cash provided by operating activities 702 $ $ 6,380 (3,470) (1,650) 1,260 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-11, Concluded Cash flows from noncapital financing activities: Loans from other funds Repayment of loans from other funds Net cash used for noncapital financing activities Cash flows from capital and related financing activities: Proceeds of revenue bonds Proceeds from sale of capital assets Purchase of capital assets Interest paid on long-term debt Net cash used for capital and related financing activities Cash flows from investing activities: Proceeds from sale of investments Interest from investments Purchase of investments Net cash used for investing activities Net increase in cash Cash on hand beginning of year Cash on hand end of year $ 600 (880) $ (280) $ 800 23 (900) (150) $ (227) $ 33 45 (440) $ (362) $ $ 391 122 513 PROBLEM 16-12 (1) (a) Inventory of Materials and Supplies Vouchers Payable To record purchases on account 72,000 (b) Operating Expenses Inventory of Materials and Supplies To record inventory adjustment ($80,000 + $72,000 – $65,000) 87,000 (c) Operating Expenses Cash To record salaries and wages paid 235,000 (d) Operating Expenses Cash To record payment of utility charge 40,000 (e) Operating Expenses Allowance for Depreciation—Building Allowance for Depreciation—Computer Equipment To record depreciation 139,500 703 72,000 87,000 235,000 40,000 6,500 133,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-12, Concluded (f) Due from General Fund Due from Water and Sewer Fund Due from Special Revenue Fund Operating Revenues To record billings 392,000 84,000 42,000 (g) Cash Due from General Fund ($140,000 + $392,000 – $136,000) Due from Water and Sewer Fund Due from Special Revenue Fund ($42,000 – $16,000) To record collections 506,000 (h) Vouchers Payable Cash To record voucher payment ($41,000 + $72,000 – $19,000) 94,000 (2) Closing Entries: Operating Revenues Operating Expenses ($87,000 + $235,000 + $40,000 + $139,500) Income Summary To close nominal accounts Income Summary Retained Earnings—Unreserved To close Income Summary 518,000 396,000 84,000 26,000 94,000 518,000 501,500 16,500 16,500 16,500 PROBLEM 16-13 (1) Landfill Expense Landfill Closure and Post-Closure Care Liability To record (300,000 ÷ 6,000,000) × $10,000,000 500,000 (2) Landfill Expense Landfill Closure and Post-Closure Care Liability To record (300,000 + 300,000) ữ 5,800,000 ì $10,200,000 less $500,000 already recognized 555,172 500,000 555,172 (3) If the landfill is accounted for in the general fund, then the liability would be recognized in the general long-term debt account group No entries would be made in the general fund until actual payments are made 704 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems PROBLEM 16-14 Redford City’s Employees’ Retirement System Fund Statement of Plan Net Assets As of June 30, 20X8 Assets Cash and short-term investments Receivables: Employer Interest and dividends Total receivables Investments, at fair value Total assets $ 38,000 $4,000 5,000 9,000 497,000 $544,000 Liabilities Refunds payable Annuities payable Total liabilities $1,000 3,000 $ Net assets held in trust for pension benefits 4,000 $540,000 Redford City’s Employees’ Retirement System Fund Statement of Changes in Plan Net Assets For Year Ended June 30, 20X8 Additions Contributions: Employer ($16,000 + $4,000) Plan members Total contributions $20,000 32,000 $ Investment income: Net appreciation (depreciation) in fair value Interest and dividend income ($30,000 + $5,000) Net investment income Total additions 52,000 $13,500 35,000 48,500 $100,500 Deductions Benefits ($13,000 + $3,000) Refunds of contributions ($2,500 + $1,000) Administrative expense Total deductions Net increase Net assets held in trust for pension benefits: July 1, 20X7 June 30, 20X8 705 $ 16,000 3,500 5,000 24,500 $ 76,000 464,000 $540,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems PROBLEM 16-15 Accounts Taxes Receivable—Current Allowance for Uncollectible Taxes Revenues 560,000 To record tax levy Revenues Taxes Receivable—Current To correct tax levy error Taxes Receivable for Other Funds Due to Other Governmental Units To record taxes to be collected Cash Taxes Receivable for Other Funds To record tax collection Due to Other Governmental Units Cash To record cash distribution Expenditures Cash Taxes Receivable—Current Revenues To record cash received by general funds Hayward County Tax Agency Fund Dr Cr Hayward County General Fund Dr Cr 3,600,000 Reed City General Fund Dr Cr 1,800,000 100,000 3,500,000 10,000 10,000 5,990,000 5,990,000 1,440,000 1,440,000 1,440,000 1,440,000 875,520* 864,000 11,520 2% charge/earnings Cash distribution Hayward County General Fund $1,440,000 × 60% $ 864,000 11,520 $ 875,520 Reed City Newbury Township General Fund General Fund $1,440,000 $1,440,000 × 30% × 10% $ 432,000 $ 144,000 (8,640) (2,880) $ 423,360 $ 141,120 706 60,000 1,740,000 8,640 423,360* *Calculation of cash distribution: Cash collected Composite rate Newbury Township General Fund Dr Cr 600,000 432,000 40,000 2,880 141,120* 144,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems PROBLEM 16-16 Fund or Account Group Journal Entry (1) General Fund Estimated Revenues Appropriations Budgetary Fund Balance—Unreserved To record the budget (2) Special Revenue Fund Estimated Revenues Appropriations Budgetary Fund Balance—Unreserved To record budget for gas tax General Fund Taxes Receivable—Current Allowance for Uncollectible Current Taxes Revenues To record tax levy Capital Cash Expenditures Other Financing Uses Other Financing Sources To record bond sale (3) (4) Projects Fund (5) General Debt Account Group Amount to Be Provided for Payment of Term Bonds Term Bonds Payable To record long-term debt Capital Projects Fund Encumbrances Fund Balance—Reserved for Encumbrances To record signed contract 707 2,500,000 2,450,000 50,000 264,500 250,000 14,500 1,400,000 28,000 1,372,000 985,000 5,000 10,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-16, Concluded Fund or Account Group (6) (7) (8) (9) (10) Journal Entry Capital Projects Fund Fund Balance—Reserved for Encumbrances Encumbrances To liquidate encumbrances Capital Projects Fund Expenditures Cash To record school cost 990,000 General Fixed Assets Account Group Buildings Investment in General Fixed Assets— Capital Projects Fund To record fixed asset 990,000 General Fund Other Financing Uses Cash To record transfer to debt service fund 100,000 Debt Service Fund Cash Other Financing Sources To record transfer from general fund 100,000 General Fixed Assets Account Group Land Investment in General Fixed Assets— Donations To record land donation 100,000 Special Revenue Fund Cash Due from State Government Revenues Deferred Revenues To record state gas taxes 205,000 60,000 Special Revenue Fund Expenditures Vouchers Payable To record vouchers approved for payment 210,000 708 1,000,000 1,000,000 990,000 990,000 100,000 100,000 100,000 205,000 60,000 210,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems PROBLEM 16-17 Dexter Village Transactions for Fiscal Year Ended June 30, 20X9 Transaction No (1) (2) (3a) (3b) (4a) (4b) (5) (6a) Fund or Account Group Account Title and Explanation Debit Amount Credit General Fund Estimated Revenues Appropriations Budgetary Fund Balance—Unreserved To record budgetary fund balances 400,000 General Fund Taxes Receivable—Current Allowance for Uncollectible Current Taxes Revenues To record tax levy 390,000 PrivateInvestments Purpose Fund Balance Principal Fund To record the value of securities donated 50,000 PrivateCash Purpose Revenues Earnings Fund To record revenues earned 5,500 394,000 6,000 7,800 382,200 50,000 5,500 General Fund Other Financing Uses Cash To record establishment of intragovernmental fund 5,000 Internal Service Fund Cash Interfund Transfer Fee To record contribution from general fund 5,000 Capital Projects Fund Estimated Other Financing Sources Estimated Revenues Appropriations 3,000 72,000 Capital Projects Fund Due from General Fund Special Assessments Receivable Revenues Other Financing Sources 3,000 72,000 709 5,000 5,000 75,000 72,000 3,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-17, Continued Transaction No Fund or Account Group (6b) Capital Projects Fund Cash Special Assessments Receivable Due from General Fund 75,000 General Fund Other Financing Uses Due to Capital Projects Fund 3,000 General Fund Due to Capital Projects Fund Cash To record cash payment 3,000 Capital Projects Fund Encumbrances Fund Balance—Reserved for Encumbrances To record contract for lighting 75,000 Capital Projects Fund Fund Balance—Reserved for Encumbrances Encumbrances To reverse encumbrances 75,000 Expenditures Cash Contracts Payable—Retained Percentage 75,000 General Fixed Assets Account Group Improvements Other than Buildings Investments in General Fixed Assets— Capital Projects Fund To record improvements 75,000 Internal Service Fund Inventory Cash or Vouchers Payable To record purchase of supplies 1,900 General Fund Cash Taxes Receivable—Current Revenues To record collections 393,000 General Fund Allowance for Uncollectible Current Taxes Revenues To correct tax revenues $7,800 original allowance – ($390,000 – $386,000) 3,800 (6c) (6d) (7a) (7b) (7c) (8) (9a) (9b) Account Title and Explanation 710 Debit Amount Credit 72,000 3,000 3,000 3,000 75,000 75,000 71,250 3,750 75,000 1,900 386,000 7,000 3,800 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-17, Concluded Transaction No Fund or Account Group (10a) Capital Projects Fund Cash Other Financing Sources To record issuance of bonds General Long-Term Debt Account Group Amount to Be Provided for Payment of Bonds General Obligation Bonds Payable To record liability General Fund Fund Balance—Reserved for Encumbrances Encumbrances To record cancellation of encumbrances upon payment for fire truck 145,000 General Fund Expenditures Cash To record purchase of fire truck 150,000 General Fixed Assets Account Group Fire Truck Investment in General Fixed Assets— General Fund Revenues To record acquisition 150,000 (10b) (11a) (11b) (11c) Account Title and Explanation Debit Amount Credit 500,000 500,000 500,000 500,000 145,000 150,000 PROBLEM 16-18 (1) $104,500 (6) $104,500 (2) $17,000 (7) $386,000 ($364,000 + $22,000) (3) $125,000 ($42,000 + $83,000) (8) $100,000 (4) $236,000 (9) $181,000 (5) $6,000 (10) $190,000 711 150,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems PROBLEM 16-19 (1) N (9) Y (16) $5,600,000 (2) Y (10) N (17) $4,750,000 (3) Y (11) Y (18) $1,200,000 (4) N (12) N (19) $1,080,000 (5) N (13) N (20) $2,473,000 ($1,080,000 + $1,420,000 – $27,000) (6) N (14) N (21) $800,000 (7) N (15) Y (22) $2,422,000 (8) N (23) $120,000 ($1,420,000 – $1,300,000) PROBLEM 16-20 (1) Transaction No (a) Fund or Account Group Account Title and Explanation Amount Debit Credit Capital Projects Fund Estimated Other Financing Sources Appropriations 600,000 Capital Projects Fund Expenditures Cash Vouchers Payable 150,000 Capital Projects Fund Cash Other Financing Sources 459,000 Capital Projects Fund Other Financing Uses Cash 9,000 Debt Service Fund Cash Other Financing Sources 9,000 General Long-Term Debt Account Group Amount to Be Provided in the Debt Service Fund Bonds Payable Capital Projects Fund Vouchers Payable Cash 100,000 General Land Long-Term Investment in general fixed assets Debt Account Group 150,000 (b) (c) (d) 712 600,000 50,000 100,000 459,000 9,000 9,000 450,000 450,000 100,000 150,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-20, Continued Transaction No (e) (f) (g) (h) (i) (j) Fund or Account Group Account Title and Explanation Debit Amount Credit Capital Projects Fund Encumbrances Fund Balance—Reserved for Encumbrances 400,000 Capital Projects Fund Fund Balance—Reserved for Encumbrances Encumbrances 200,000 Capital Projects Fund Expenditures Cash 200,000 General Fund Other Financing Uses Cash 9,000 Debt Service Fund Cash Other Financing Sources 9,000 Debt Service Fund Expenditures Cash 18,000 Capital Projects Fund Cash Other Financing Sources 100,000 General Long-Term Debt Account Group Amount to Be Provided in the Debt Service Fund Bonds Payable Capital Projects Fund Fund Balance—Reserved for Encumbrances Encumbrances 200,000 Capital Projects Fund Expenditures Cash 210,000 Capital Projects Fund Cash Revenues 12,000 400,000 200,000 200,000 9,000 9,000 18,000 100,000 100,000 100,000 200,000 210,000 12,000 (2) Closing and Adjusting Entries: Fund or Account Group Account Title and Explanation Amount Debit Credit Capital Projects Fund Appropriations Estimated Other Financing Sources 600,000 (Closing entries) Revenues Other Financing Sources Other Financing Uses Expenditures Fund Balance—Unreserved, Designated 12,000 559,000 713 600,000 9,000 560,000 2,000 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Ch 16—Problems Problem 16-20, Concluded Fund or Account Group Account Title and Explanation (Transfer Interfund Transfers-Out residual equity Cash to debt Fund Balance—Unreserved, Designated service fund.) Interfund Transfers-Out General Fixed Land Assets Account Building Group Investment in General Fixed Assets— (Capitalize total Capital Projects Fund expenditures for land and building.) (3) Amount Credit Debit 2,000 2,000 2,000 2,000 150,000 410,000 560,000 City of Port Washington Statement of Revenues, Expenditures, and Changes in Fund Balance For Year Ended December 31, 20X8 Library Construction Project Revenues Expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses): Bond proceeds Operating transfers-out Total other financing sources (uses) Excess (deficiency) of revenues and other financing sources over expenditures and other financing uses Interfund transfer to debt service fund Fund balance—January 1, 20X8 Fund balance—December 31, 20X8 714 $ 12,000 560,000 $(548,000) $ 559,000 9,000 550,000 $ $ $ 2,000 (2,000) 0 ... corporation would 11 The accounting emphasis for governmental funds emphasizes the funds available, spendable resources, and their expenditures Modified accrual accounting is required The accounting for...To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com accrual basis of accounting They account for their own assets (including... recovered by revenue Proprietary funds are accounted for with a capital maintenance measurement focus, using the 12 Private-purpose trust funds are used to account for assets held by the government