Académique Documents
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CHAPTER 17
GOVERNMENTAL ENTITIES: INTRODUCTION AND GENERAL FUND ACCOUNTING
ANSWERS TO QUESTIONS
Q17-1 A fund is an independent fiscal and accounting entity with a self-balancing set of
accounts recording cash and/or other resources together with all related liabilities,
obligations, reserves, and equities which are segregated for the purpose of carrying on
specific activities or attaining certain objectives in accordance with special regulations,
restrictions, or limitations. A fund may receive resources from a variety of sources,
including collection of taxes on property, income, or commercial sales; receipt of grants,
fines, or licenses; and collection of service charges.
Q17-2 The eleven funds generally used by local and state governments are:
Governmental
a. General fund
b. Special revenue fund
c. Capital projects fund
d. Debt service fund
e. Permanent fund
Proprietary
f. Internal service fund
g. Enterprise fund
Fiduciary
h.
i.
j.
k.
General fund: All financial resources except those required to be accounted for in
another fund are accounted for in the general fund.
b.
Special revenue fund: The proceeds of specific revenue sources that are legally
restricted for specified purposes are accounted for in the special revenue fund.
c.
d.
Debt service fund: The accumulation of resources for and the payment of, general
long-term debt principal and interest are accounted for in the debt service fund.
17-1
Q17-2 (continued)
e.
Permanent fund: Accounts for resources for which the principal must be
maintained, but for which the earnings may be used in support of governmental
programs.
f.
g.
h.
i.
Investment trust funds: Accounts for the external portion of investment pools of
governing units.
j.
Private-purpose trust fund: Accounts for trust arrangements under which both
principal and interest may be used to benefit specific individuals, private
organizations, or other governmental units. Note that these resources have specific
purposes as stated by the donor or grantor, and are not available for general
governmental programs.
k.
Q17-3 The modified accrual basis includes some aspects of accrual accounting and
some aspects of cash-basis accounting. Under the modified accrual basis, the emphasis
is on reporting how well the government performed by focusing on when the revenue
and expenditures are recognized in the accounts and reported in the financial
statements. The emphasis is not on how much was earned or on the amount of
expenses.
Q17-4 The modified accrual basis is used for funds for which expendability is the
concern because the governing entity is interested in the determination of the resources
still remaining to be expended to carry out the objectives of the fund.
Q17-5 Property taxes are recognized as revenue in the general fund when the taxes
are levied, provided they apply to and are collectible within the current fiscal period, or
within a short period (< 60 days) after the end of the fiscal period.
Q17-6 GASB 33 states that taxpayer-assessed income and sales taxes should be
accrued in the general fund when they become both measurable and available to
finance expenditures of the fiscal period. Sales taxes held by other governmental units
should be recognized if the taxes are both measurable and available for expenditure.
Measurability in this case is based on an estimate of the sales taxes to be received, and
availability is based on the ability of the governing entity that will receive the future
distribution to obtain current resources through credit by using future sales tax receipts
as collateral for the loan.
17-2
17-3
Q17-12 Interfund services provided and used are interfund activities that would be
treated as revenues or expenditures if they were made with parties external to the
governmental entity. An example would be if the general fund purchased supplies from
the internal service
Interfund transfers out or in are transfers of resources between funds. An example would
be a transfer of resources from the general fund (an interfund transfer out) to the capital
projects fund (a transfer in) to assist in the construction costs of a new municipal
building.
Q17-13 An interfund transfer is reported as "Other Financing Sources or Uses" in the
general fund's statement of revenues, expenditures, and changes in fund balance.
Q17-14 The loan of $2,000 from the general fund to the enterprise fund is reported on
the financial statements of the general fund on the balance sheet as a receivable. The
loan is not shown on the fund's statement of revenues, expenditures, and changes in
fund balance.
Q17-15 Governmental accounting places many controls over expenditures, and much of
the financial reporting focuses on the various aspects of an expenditure. An expenditure
can be made for a function of the governmental entity or an activity within a function.
Expenditures for an activity can be classified by object, which is the type of expenditure.
The extensive detail required to account for and cross reference an expenditure to
ensure it is properly classified at all levels requires a very comprehensive accounting
system.
17-4
SOLUTIONS TO CASES
C17-1 Budget Theory
a. A governmental accounting system must make it possible to:
1. Present fairly and with full disclosure, in conformity with generally accepted
accounting principles, the financial position and results of financial operations of the
funds and account groups of the governmental unit.
2. Determine and demonstrate compliance with finance-related legal and contractual
provisions.
Because the legislative body enacts the budget into law, the budget is recorded in the
accounts of a governmental unit. This enables a governmental unit to show legal
compliance with the budget by providing an accounting system that measures actual
expenditures and obligations against amounts appropriated and actual revenue against
estimated revenue. Appropriations enacted into law constitute maximum expenditure
authorizations during the fiscal year, and they cannot legally be exceeded unless
subsequently amended by the legislative body.
b.
As the new fiscal year begins, the budget, already enacted in law by the
legislative body, is recorded. Budgetary accounts are set up to record the estimated
revenue and appropriations in the fund accounts by debiting estimated revenue and
crediting appropriations. If there is a difference between estimated revenue and
appropriations, the excess or deficit is credited or debited, respectively, to fund balance.
In addition, subsidiary ledger accounts are maintained for estimated revenue by source
and for appropriation/expenditure items.
At the end of the fiscal year, the estimated revenue and the appropriations accounts are
among other budgetary accounts closed out to the budgetary fund balance.
17-5
17-6
C17-2 (continued)
b. Inventories are often ignored in governmental accounting because of an emphasis on
budgeting revenue against outlays without looking behind the outlays to determine the
extent to which they represent actual usage or consumption. Put another way, there is
an emphasis on the cash or fiscal aspects rather than the operational aspects. This is
easy to understand when one considers that general-fund expenditures for firemen's
salaries and for the purchase of a new fire truck are accounted for in the same way.
However, inventories are not wholly ignored in governmental accounting. In those funds
in which accounting parallels commercial accounting practice, such as enterprise funds,
inventories are taken into consideration. Similarly, in an internal service fund concerned
with rendering service involving the consumption of supplies or the delivery of stores to
other funds and activities, the inventories of supplies or stores are taken into
consideration in computing billings to departments serviced.
Larger amounts of inventories can and should be taken into consideration when
preparing budgets. A fund, such as a general fund, having departments that possess
large inventories at year-end obviously can make smaller appropriations for the coming
year than it would if those departments had zero inventories.
C17-3 Revenue Issues
The following presentation describes the proper accounting and financial reporting for
each item. Note that there are two decision points: (1) when a receivable or other asset
should be recognized, and (2) when a revenue should be recognized.
a. GASB 33 states that an asset (receivable or cash) should be recognized for imposed
nonexchange revenue when the government has an enforceable claim to the resources,
or the resources are received, whichever comes first. The property taxes receivable
would be debited at the time an enforceable claim arises. In most governments, this is
the levy date (sometimes termed the lien date); in some others, it is the assessment date
or other date fixed by law. It depends on the enabling legislation permitting the
government to impose property taxes. Property tax revenue would be credited when the
resources become available for use for current expenditures. Resources received or
recognized as receivables before becoming available for use should have a credit to
deferred revenues. Recording of both the asset debit and the revenue or deferred
revenue credit must be in compliance with the requirements established by GASB 33.
The estimated uncollectible should be recorded as a reduction of the revenue, and a
contra account for the Allowance for uncollectibles should be recorded.
b. For property taxes received in advance of when they can be used for current
expenditures, a debit is made to cash and a deferred revenue account, for example,
property taxes received in advance, should be credited until the taxes are available for
use at which time the deferral should be transferred to revenue.
c. GASB 33 requires that this derived tax revenue should be recognized as a receivable
when the underlying exchange transaction occurs or resources are received, whichever
is first. The revenue is recognized when the underlying exchange has occurred and the
resources are available. In the rare cases in which derived tax revenues are received
before the underlying exchange transaction has occurred, the credit should be to
deferred revenues. Estimates of collections expected in the near future should be made
and the receivable recognized in accordance with the above guidelines.
17-7
C17-3 (continued)
d. Under GASB 33, this is an example of a voluntary nonexchange transaction unless
the payment is the result of a government-mandated program. The asset will be
recorded (receivable or cash) when all eligibility requirements are met or resources are
received, whichever is first. Eligibility requirements are those established by the provider
and may state requirements for specific allowable costs or specify a time requirement.
Revenue will be recorded when all the eligibility requirements are met. On the modified
accrual basis, revenues would be recorded when all eligibility requirements are met and
the resources are available.
e. Interest earned on investments is recognized as a receivable in the period in which it
is accrued but not yet received. But interest is not recognized as revenue until it is
considered available to liquidate liabilities of the current period. Thus, interest may be
accrued to a receivable with a credit to deferred revenue in the period prior to the actual
collection of the interest. In addition, the city should make an adjusting journal entry at
each balance sheet date to recognize any adjustments required for changes in the fair
value of the investments. Investment earnings are reported in the revenues section of
the operating statement.
f. GASB 33 specifies that this voluntary nonexchange transaction, with its time restriction
and eligibility requirements, should be recorded as an asset when the applicable
eligibility requirements are met or the resources are received, whichever is first. Under
the modified accrual basis of accounting, revenues should be recognized when all
applicable eligibility requirements are met and the resources are available. Prior to that,
the community may recognize a credit for deferred revenues if the resources have been
received.
17-8
17-9
C17-5 (continued)
a. The budgetary comparison schedules for the general fund are reported as other required
supplementary information. This schedule for the general fund should be used to answer
questions a and b. These schedules disclose the amounts budgeted for each item of
revenue, appropriations for the various functions of government, and for estimated transfers
in from other funds and estimated transfers out to other funds in the government.
b. See the response to question a.
c. The notes to the basic financial statements should disclose the encumbrance policy
whether the government has a policy in which the outstanding encumbrances lapse at yearend or do not lapse at year-end.
d. This question reinforces the students understanding of the balance sheet equation for
the general fund: Assets = Liabilities + Fund Balance. This question also makes students
aware of the two forms of fund balance assigned and unassigned.
e. This question makes students aware that inventories are reported on the balance sheet
of the general fund if the amount is material. If reported, the next question is the accounting
method for inventories the purchase or consumption method. The notes should answer
the policy question.
f. This question makes students aware of the modified accrual method and its application
to property taxes. The notes to the financial statements should disclose that revenue from
property taxes is reported when measurable and available to finance expenditures of the
current period. The notes should also disclose the use of the 60-day rule for property tax
revenue as well as the percentage of property taxes that were estimated to be uncollectible.
g. This question focuses attention once again on MD&A and the different items that are
reported therein. In MD&A, the governments finance director should explain why revenues
in the general fund either increased or decreased during the most recent year.
h. This question addresses the issue that budgeted inflows and outflows should be
compared with the actual resource inflows and outflows for the year. Was the budget more
or less optimistic in predicting resource inflows from revenues? The same question is
appropriate for appropriations versus expenditures. This question also should help students
understand that the statement of revenues, expenditures, and changes in fund balance
reports the change in fund balance that resulted from actual resource inflows and outflows.
i. This question makes students aware that taxes may be the primary resource inflow for
the general fund, but they are not the only resource inflow. This question also emphasizes
that the revenues of the general fund come primarily from nonexchange transactions.
j. This question makes students aware of one category of interfund transactions-interfund loans and advances. The balance sheet of the general fund should report the
receivables (due from or advances to accounts) and payables (due to and
advances from accounts) associated with any interfund borrowings.
17-10
17-11
SOLUTIONS TO EXERCISES
E17-1 Multiple-Choice Questions on the General Fund [AICPA Adapted]
1.
2.
3.
4.
5.
6.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
17-12
2.
3.
4.
5.
6.
7.
8.
9.
10.
17-13
2.
3.
The balances in the ENCUMBRANCES CONTROL and the FUND BALANCEASSIGNED FOR ENCUMBRANCES accounts are the same. Therefore, an
excess of one account over the other indicates a recording error.
4.
5.
The 60-day rule for property tax revenues states that property taxes collected
within 60 days after the end of a fiscal year (within first 60 days of 2007) may be
classified as revenues of the prior fiscal year (2006). The entry to record the tax
levy would be:
Property Taxes Receivable
700,000
Allowance for Uncollectible Taxes
10,000
Revenue Property Taxes
600,000
Deferred Revenue (reported as a liability
on the general fund balance sheet)
90,000
[Note: The estimated uncollectibles are on the property taxes reported as
deferred revenue.]
6.
Upon receipt of the order, Oak would record the following entries:
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
ENCUMBRANCES CONTROL
Expenditures Control
Vouchers Payable
7.
5,000
4,950
9.
10.
4,950
8.
5,000
17-14
XXXXXX
XXX
(2)
21,000
21,000
21,000
21,000
21,000
21,000
ENCUMBRANCES
21,000
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
21.000
Establish budgetary control over encumbrances renewed from prior year.
(4)
21,000
Expenditures
21,800
Vouchers Payable
Record expenditure for goods received at actual cost of $21,800.
(5)
21,000
21,800
17-15
21,800
21,800
E17-5 (continued)
b.
(2)
21,000
21,000
21,000
21,000
21,000
(5)
21,000
(4)
21,000
(3)
21,000
21,000
800
21,800
17-16
800
21,000
800
E17-5 (continued)
(Note: In entry (4), the $800 excess of actual cost over the encumbered amount must be
approved as part of 20X3's expenditures. Entry (4) records the City Councils approval
with a debit to Expenditures (20X3) which increases 20X3s total expenditures. The
expenditures for 20X3 are closed in entry (5). If the actual cost was less than the
encumbered amount, then the difference should be closed to Fund Balance-Unassigned,
although some governmental units have a policy of closing any difference between actual
and encumbered amounts for prior year encumbrances to the current year's
expenditures.)
c.
(1)
21,000
21,000
Purchase of supplies:
August 8, 20X2
Expenditures
Vouchers Payable
Acquire inventory of supplies.
(2)
3,600
3,600
2,800
2,800
800
17-17
2,800
2,800
800
E17-6 (continued)
(3)
b.
2,800
2,800
2,800
2,800
2,800
2,800
Purchase of supplies:
August 8, 20X2
Expenditures
Vouchers Payable
Acquire inventory of supplies.
(2)
3,600
(3)
3,600
2,800
3,600
2,800
3,600
17-18
2,800
2,800
(b)
5,400
(c)
5,400
15,600
15,600
15,600
15,200
15,600
15,200
1,800
1,800
Closing entries:
December 31, 20X1
Inventory of Supplies
Expenditures
Recognize ending inventory of supplies.
Fund Balance Unassigned
Fund Balance Assigned for
Inventories
Establish fund reserve for ending inventory.
Fund Balance Unassigned
Expenditures
Close expenditures account:
$ 5,400 Insurance Policy
15,200 Furniture
680 Supplies
$21,280 Total
1,120
1,120
1,120
21,280
17-19
1,120
21,280
$1,862,000
1,500
235,000
125,000
66,000
$2,289,500
Notes:
(1) The amount reported for property tax revenue, $1,862,000 is computed as follows:
Levy
$2,000,000
Less:
Property taxes expected to be collected after August 31,
20X8 the 60 day rule for property tax
(100,000)
collections report in balance sheet as deferred
revenue at June 30, 20X8, net of $2,000
allowance for uncollectible taxes (2%)
The allowance for uncollectible taxes on this periods
revenue [($2,000,000 - $100,000 deferred) X .02]
(38,000)
Property tax revenue for year ended June 30, 20X8
$1,862,000
(2) The receipt of $50,000 for the repayment of the advance is recorded in the
following manner by the general fund:
Cash
Advance to Internal Service Fund
Interest revenue
51,500
50,000
1,500
(3) Collection of property taxes during the year ended June 30, 20X8, does not affect the
recognition of revenue. The revenue was recognized at the levy date, not the collection
date.
(4) Revenue recognition related to the State grant is based upon spending the grant to
acquire computer equipment. Therefore, revenue from the State grant is $235,000, the
amount of the grant expended. The $15,000 remainder of the grant monies received is
shown as unearned revenue, a liability.
(5) Revenue from the sales tax is the amount collected during the year ended June 30,
20X8, or $125,000. The additional sales taxes of $25,000 will be revenue of the next
fiscal year when the taxes are received from the State and are available to pay for
expenditures incurred in the next fiscal year.
(6) The borrowing of the $800,000 using the property tax levy as collateral represents a
liability in the general fund. This amount is not revenue.
(7) The $30,000 received from a terminated debt service fund is reported as an other
financing source transfer in, not revenue.
17-20
E17-8 (continued)
(8) The revenue from liquor licenses is the amount collected, not the amount expected
to be collected. Therefore, revenue of $66,000 is recognized from the sale of liquor
licenses for the year ended June 30, 20X8.
(9) The $15,000 reimbursement is not reported as revenue in the general fund.
Reimbursements are recorded as reductions in expenditures.
(10) The collection of the delinquent property taxes is not reported as revenue by the
general fund for the year ended June 30, 20X8. The revenue associated with the
delinquent property taxes was reported in the preceding fiscal year, because the
property taxes were expected to be collected within 60 days of the end of the fiscal year.
E17-9
Computation of Expenditures Reported on the Statement of Revenues,
Expenditures, and Changes in Fund Balance for the General Fund
Benson City
Amount Reported for Expenditures by the General Fund
For the Year Ended June 30, 20X8
Computer equipment acquisitions in September, 20X7
Reimbursement to special revenue fund in May, 20X8
Use of city water during the fiscal year
Supplies acquisitions
Salaries and wages of general fund employees
Interest paid on loan from local bank
Employers pension contribution to pension trust
Lease payments
Total amount reported for expenditures
$ 202,000
15,000
12,000
35,000
900,000
15,000
95,000
10,000
$1,284,000
Notes:
(1) The $150,000 transfer to the capital projects fund in March, 20X8, is reported as an
other financing use transfer out. Therefore, it should not be included in the amount
reported for expenditures for the year ended June 30, 20X8.
(2) The amount paid for the computer equipment is the amount reported for
expenditures. Therefore, $202,000 is included in expenditures for equipment, not the
estimated amount of $200,000 that was recorded for the order (encumbrances).
(3) None of the $500,000 transferred to the internal service fund should be reported as
expenditures. The $200,000 that must be repaid by the internal service fund should be
accounted for as an advance (a receivable in the general fund), while the $300,000 that
represented a permanent contribution should be accounted for as an other financing use
transfer out.
(4) The $15,000 reimbursement to the special revenue fund should be included in the
expenditures of the general fund for the year ended June 30, 20X8.
17-21
E17-9 (continued)
(5) The $12,000 of billings from the water department should be accounted for as
expenditures by the general fund. Billings for water usage constitute an interfund
services provided and used transaction. Note that the amount paid by the general fund,
$11,500, is not the correct amount of the expenditures. The correct amount is $12,000.
(6) The acquisition of supplies and the payment of salaries and wages by the general
fund should be accounted for as expenditures. The entire cost of the supplies purchased
should be reported as expenditures because the general fund uses the purchase
method of accounting for supplies.
(7) The outstanding encumbrances at June 30, 20X8, are not included in expenditures.
The outstanding encumbrances will be reported on the general fund balance sheet as a
reservation of fund equity.
(8) The repayment of the principal of the bank loan is not an expenditure. However, the
amount paid for interest, $15,000, should be included in expenditures for the year ended
June 30, 20X8.
(9) The general funds $95,000 contribution to the citys pension trust should be included
in expenditures of the general fund for the year ended June 30, 20X8. The employers
contribution to a pension trust is an example of an interfund services provided or used
transaction.
(10) The general funds lease payments should be included in the amount reported for
expenditures for the year ended June 30, 20X8.
(11) For proper reporting on the statement of revenues, expenditures and changes in
fund balance, each expenditure should be associated with a governmental function,
such as General Governmental or Streets and Highways.
17-22
a.
1,145,000
25,000
30,000
1,200,000
(2)
(3)
(4)
(5)
b.
APPROPRIATIONS CONTROL
ESTIMATED OTHER FINANCING
USES TRANSFER OUT
BUDGETARY FUND BALANCE UNASSIGNED
ESTIMATED REVENUES CONTROL
Close budgetary accounts.
1,130,000
40,000
25,000
1,140,000
30,000
25,000
Assets
Cash
Property Taxes Receivable Delinquent
$100,000
Less: Allowance for Uncollectibles
Delinquent
(7,200)
Due from Other Funds
Total Assets
Liabilities and Fund Balance
Vouchers Payable
Due to Other Funds
Fund Balance:
Spendable:
Assigned to:
General Government Services
$ 32,000
Unassigned
92,000
Total Liabilities and Fund Balance
17-23
90,000
92,800
14,600
$ 197,400
$ 65,000
8,400
124,000
$ 197,400
$1,130,000
40,000
$1,170,000
1,140,000
$ 30,000
(25,000)
5,000
119,000
$ 124,000
$
E17-12
Matching Questions Involving Interfund Transactions and Transfers in
the General Fund
1. B
2. C
3. C
4. C
5. C
6. B
7. A
8. D
9. A
10. B
17-24
SOLUTIONS TO PROBLEMS
P17-13 General Fund Entries [AICPA Adapted]
(1)
2,000,000
(2)
Taxes Receivable
Allowance for Uncollectible Taxes
Property Tax Revenue
Record the property tax levy.
1,870,000
(3)
(4)
Cash
Taxes Receivable
Record property tax collections.
1,820,000
(5)
ENCUMBRANCES
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
Record purchase commitments.
1,070,000
(6)
8,000
1,940,000
60,000
10,000
1,860,000
8,000
1,820,000
1,070,000
1,000,000
(7)
Expenditures
Vouchers Payable
Record actual expenditures.
1,840,000
(8)
Vouchers Payable
Cash
Record payment of vouchers during period.
1,852,000
(9)
APPROPRIATIONS CONTROL
BUDGETARY FUND BALANCE UNASSIGNED
ESTIMATED REVENUES CONTROL
Close budgetary accounts.
1,940,000
60,000
1,000,000
1,840,000
1,852,000
2,000,000
(10)
(11)
70,000
70,000
17-25
1,860,000
1,840,000
20,000
3,000,000
Taxes Receivable
Allowance for Uncollectible Taxes
Revenue from Taxes
Record tax levy.
2,870,000
Cash
Taxes Receivable
Record tax collection.
2,810,000
40,000
70,000
2,800,000
2,810,000
40,000
$ 150,000
2,870,000
(2,810,000)
(170,000)
$ 40,000
130,000
60,000
ENCUMBRANCES
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
Renew encumbrances from prior period.
60,000
ENCUMBRANCES
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
Record encumbrances.
2,700,000
17-26
2,980,000
20,000
130,000
60,000
60,000
2,700,000
P17-14 (continued)
3.
Expenditures
Due to Other Funds
Record liability to other funds for services received.
4.
2,700,000
2,700,000
142,000
60,000
58,000
210,000
2,640,000
ENCUMBRANCES
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
Record May 10 encumbrance.
17-27
142,000
2,700,000
2,700,000
60,000
58,000
210,000
2,640,000
91,000
91,000
2.
1,877,000
37,000
ENCUMBRANCES
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
Renew encumbrances from prior period.
21,000
21,000
21,000
1,600,000
Cash
Property Taxes Receivable Current
Property Taxes Receivable Delinquent
Collect property taxes.
1,590,000
9,000
333,000
17-28
1,840,000
21,000
16,000
1,584,000
1,507,000
83,000
7,000
2,000
93,000
16,000
284,000
39,000
10,000
P17-15 (continued)
3.
ENCUMBRANCES
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
Record purchase orders.
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
ENCUMBRANCES
Reverse reserve for items received.
4.
b.
1,800,000
1,800,000
1,773,000
Expenditures
Vouchers Payable
Actual expenditures for items received.
1,788,000
Vouchers Payable
Cash
Vouchers paid.
1,793,000
1,773,000
1,788,000
1,793,000
13,000
37,000
50,000
Pine Ridge
General Fund
Preclosing Trial Balance
December 31, 20X2
Debit
Cash
Property Tax Receivable Delinquent
Allowance for Uncollectibles Delinquent
Due from Central Stores Fund
Vouchers Payable
Due to Motor Pool Fund
Fund Balance Unassigned
Property Tax Revenue
Sales Tax Revenue
Miscellaneous Revenue
Expenditures
Other Financing Uses Transfer Out
ESTIMATED REVENUES CONTROL
APPROPRIATIONS CONTROL
ESTIMATED OTHER FINANCING USES TRANSFER OUT
ENCUMBRANCES
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
17-29
$ 191,000
93,000
13,000
1,788,000
37,000
1,877,000
48,000
$4,047,000
Credit
16,000
26,000
10,000
161,000
1,586,000
284,000
39,000
1,840,000
37,000
48,000
$4,047,000
P17-15 (continued)
c.
Closing entries:
APPROPRIATIONS CONTROL
ESTIMATED OTHER FINANCING
USES TRANSFER OUT
ESTIMATED REVENUES CONTROL
Close budgetary accounts.
BUDGETARY FUND BALANCE ASSIGNED
FOR ENCUMBRANCES
ENCUMBRANCES
Close remaining encumbrances.
1,840,000
37,000
48,000
1,586,000
284,000
39,000
1,877,000
48,000
48,000
1,788,000
37,000
84,000
Pine Ridge
General Fund
Balance Sheet
December 31, 20X2
Assets
Cash
Property Tax Receivables Delinquent
Less: Allowance for Uncollectibles Delinquent
Due from Central Stores Fund
Total Assets
Liabilities and Fund Balance
Vouchers Payable
Due to Motor Pool Fund
Fund Balance:
Spendable:
Assigned to:
General Government Services
Unassigned
Total Liabilities and Fund Balance
17-30
$ 93,000
(16,000)
$191,000
77,000
13,000
$281,000
$ 26,000
10,000
$ 48,000
197,000
245,000
$281,000
P17-15 (continued)
e.
Pine Ridge
General Fund
Statement of Revenues, Expenditures, and Changes
in Fund Balance
For Fiscal Year Ended December 31, 20X2
Revenue:
Property Taxes
Sales Taxes
Miscellaneous
Total Revenue
Expenditures:
Current
Capital Outlay Furniture
Total Expenditures
Excess of Revenue over Expenditures
Other Financing Sources (Uses):
Transfer Out
Change in Fund Balance
Fund Balance, January 1, 20X2
Fund Balance, December 31, 20X2
$1,586,000
284,000
39,000
$1,909,000
$1,746,000
42,000
$1,788,000
$ 121,000
(37,000)
84,000
161,000
$ 245,000
$
[Note that the $42,000 expenditure for the office furniture capital outlay is reported
separately. The theoretical support for this is that the expenditure will also benefit future
periods. Some governmental entities report capital outlays made in the general fund with
current expenditures because current financial resources were expended. Some
governments integrate capital outlay expenditures into the appropriate functional
categories (e.g., fire protection, government administration, or streets and highways)
rather than separately report the expenditures for capital outlays. The choice of reporting
alternative for the general fund is up to the governmental entity because the total
expenditures will be the same regardless of how or where the capital outlay is reported.]
17-31
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17-32
17-33
17-34
16
b.
$170,000 = $80,000 of the restricted grant that has been expended, plus
$50,000 in fines plus $40,000 in fees
c.
d.
e.
$30,000 = the amount of the transfer in received by the debt service fund and
then expended for interest for the year
f.
18
g.
$150,000 = the amount of the state grant. The bond proceeds would be
reported as an other financing source.
h.
13
i.
11
17-35
$150,000
610,000
$ 110,000
760,000
$500,000
25,000
(525,000)
$345,000
17-36