Exam 17: Introduction to Fund Accounting

The "reserve for encumbrances-prior year" account represents amounts recorded by a governmental unit for:

On December 31, 2017, the following account balances, among others, were included in the preclosing trial balance of the General Fund of the City of Springfield. Estimated Revenue $2,960,000 (1) The balance in this account was $270,000 on January 1, 2017. Purchase orders outstanding on December 2017 total $530,000. (2) Supplies on hand on December 31, 2017, amount to $380,000. Required: 1. What was the balance in the Unreserved Fund Balance account on December 31, 2016? What was the total Fund Balance on December 31, 2016? 2. Prepare the necessary adjusting and closing entries for the year ended December 31, 2017. Springfield uses the purchase method to account for supplies.

The GASB has the responsibility for establishing financial accounting standards for all of the following entities EXCEPT:

The following related entries were recorded in sequence in the general fund of a municipality: The sequence of entries indicates that:

Which type of fund entities are used to account for the activities of nonbusiness organizations that are similar to those of business enterprises?

During 2017, the City of Party Beach was involved in the following transactions: 1. A budget consisting of estimated revenues of $1,500,000 and appropriations for expenditures of $1,550,000 was approved by the city council. 2. Statements of property tax assessments totaling $1,100,000 were mailed to property owners. Experience indicates that 2% of assessed taxes will be uncollectible. 3. Equipment costing $85,000 was purchased, and old equipment was sold for $15,000 at the end of its estimated useful life. 4. The city manager signed a contract to purchase a machine costing $25,000. 5. The city received a statement from the state indicating that the city's portion of the state sales tax is $50,000. 6. The machine ordered in (4) above is delivered and accepted. The invoice in the amount of $26,000 was approved for payment. Required: Prepare the journal entries needed to account for the preceding transactions.

The entry to record the receipt of office equipment previously encumbered includes a debit to:

The two basic statements prepared for expendable fund entities are a balance sheet and a(n):

Fund entities may be classified as expendable fund entities, fiduciary fund entities, and proprietary fund entities. Distinguish among expendable, fiduciary, and proprietary fund entities.

The entry to close appropriations, expenditures, and encumbrances accounts includes a debit to:

At the beginning of 2017, the City of Mauer reported an Unreserved Fund Balance of $890,000 and a supplies inventory balance of $280,000. During the year, Mauer purchased $360,000 in supplies and used $350,000 worth. The city will report a reserve for supplies inventory. Required: a. Prepare the journal entries needed to account for the supplies under the consumption method. b. Prepare the necessary journal entries under the purchases method. c. What would the December 31, 2017, balance in the Unreserved Fund Balance be under the consumption method, assuming that the only transactions of the fund are those involving the supplies?

The following account balances, among others, were included in the preclosing trial balance of the General Fund of the City of Baxter on December 31, 2017. Required: a. Prepare the necessary closing entries on December 31, 2017. b. Calculate the amount of both the unreserved fund balance and the total fund balance in the balance sheet (1) on December 31, 2016, and (2) on December 31, 2017.

If a credit was made to the fund balance in the process of recording a budget for a governmental unit, it can be assumed that:

The following information regarding the fiscal year ended June 30, 2017, was drawn from the accounts and records of the Johnson County general fund: Required: Prepare a statement of revenues, expenditures, and changes in fund balance for the Johnson County general fund for the year ended June 30, 2017.

The expendable fund entity's measurement focus is on:

The reserve for encumbrances account is properly considered to be a:

The term used to describe the application of accounting to expendable fund entities is the:

In accounting for expendable fund entities, revenue is ordinarily not recognized until:

When budgeted expenditures are enacted into law, they are referred to as:

The trial balance for the General Fund of the City of Logan as of December 31, 2016, is presented below: Transactions for the year ended December 31, 2017 are summarized as follows: 1. The City Council adopted a budget for the year with estimated revenue of $720,000 and appropriations of $710,000. 2. Property taxes in the amount of $495,000 were levied for the current year. It is estimated that $20,000 of the taxes levied will prove to be uncollectible. 3. Proceeds from the sale of equipment in the amount of $32,000 were received by the General Fund. The equipment was purchased four years ago with resources of the General Fund at a cost of $200,000. On the date it was purchased, it was estimated that the equipment had a useful life of six years. 4. Licenses and fees in the amount of $90,000 were collected. 5. The total amount of encumbrances against fund resources for the year was $595,000. 6. Vouchers in the amount of $445,000 were authorized for payment. This was $11,000 less than the amount originally encumbered for these purchases. 7. An invoice in the amount of $19,000 was received for goods ordered in 2016. The invoice was approved for payment. 8. Property taxes in the amount of $425,000 were collected. 9. Vouchers in the amount of $385,000 were paid. 10. Forty-one thousand dollars was transferred to the General Fund from the Trust Fund. 11. The City Council authorized the write-off of $15,000 in uncollected property taxes. Required: 1. Prepare entries, in general journal form, to record the transactions for the year ended December 31, 2017. 2. Prepare the necessary closing entries for the year ending December 31, 2017.