Exam 11: State and Local Governments: Other Transactions

A working landfill is reported in a proprietary fund and is 60% filled at year-end. Total estimated closure and postclosure costs are $25,000,000, and the current balance in the liability for landfill closure and postclosure costs is $12,000,000. The operating statement of the landfill will report what amount for closure and postclosure expenses for the current year?

The State of California's general fund enters a receive variable/pay fixed interest rate swap that hedges its variable rate debt. If market interest rates fall during the year, where is the change in the value of the swap investment reported in the governmental funds balance sheet?

Use the following information to answer Questions. On April 1, 2020, an enterprise fund issued $2,000,000 in variable rate debt, with interest paid on March 31 of each year, the fiscal year-end. The rate is reset annually. The variable rate for fiscal 2021 is 3.5%. On the same date, the fund entered a receive variable/pay fixed interest rate swap, where the fund pays a 3.6% fixed rate to a counterparty. By the end of fiscal 2021, the variable rate fell to 3.3% and the swap declined in value by $8,000. The swap qualifies for hedge accounting, per SGAS 53. -How is the enterprise fund's investment in derivatives reported on its statement of net position?

Use the following information to answer Questions Construction activities for Oneida County for 2020 are as follows: 1) A capital projects fund is established for the construction of a recreation center. The total project is estimated to cost $15,000,000, with funding to come from a $9,000,000 general obligation bond issue, a $4,000,000 federal grant, and a $2,000,000 transfer from the general fund. 2) The general fund transfers $2,000,000 to the capital projects fund. 3) $3,500,000 of the federal grant is received in cash. 4) The bond issue with a par value of $9,000,000 yields $9,002,000. The premium is transferred to the debt service fund to finance payment of bond principal and interest. 5) A contract for $14,800,000 is awarded to a contractor. 6) Invoices for $8,000,000 are received for work performed by the contractor. The town has a 5% retainage policy and pays the contractor $7,600,000 in cash. 7) The county's spending policy is to use restricted resources first. The county uses the GAAP budgetary basis for end-of-year encumbrances. -What is the total for other financing sources for 2020, reported on the capital projects fund operating statement?

On January 4, 2021, the Cumberland County authorized a $5 million 2% bond issue for the construction of a recreation center. On June 1, the bonds were issued at 100.5, and the additional amount received was transferred to the debt service fund. The renovation occurred in the fall of 2021, at a cost of $5 million. On September 30, the general fund transferred to the debt service fund the total amount necessary for payment of semiannual interest on the bonds. On December 1, the debt service fund paid the semiannual interest on the bonds. Required Record all necessary entries to record the above information in the: a. Capital projects fund. Include budget and closing entries. b. General fund. c. Debt service fund.

A state issues bonds, and the money received is to be used for construction of roads. The cash received from the bond issue is recorded as:

A county's special revenue fund reports total fund balances of $2,000,000 from resources restricted for fire protection services in unincorporated areas. The resources come from state grants and from allocations of general property taxes. The fund's assets consist of cash, receivables, prepaid expenses and inventories. The fund balance is most likely divided into which categories?

In 2021, Sebring County established a Flood Control special revenue fund. During 2021, the following events occurred: •The general fund transferred $5,000,000 to the Flood Control Fund. •A state grant of $3,000,000 was received. •Contracts totaling $5,500,000 were signed for flood control work. Contractors submitted bills for $3,200,000. Bills totaling $3,100,000 were paid. •Equipment of $1,000,000 was purchased. $300,000 remains unpaid. •The fund does not use budgetary accounts. •The county's policy is to spend restricted resources first. Required a. Prepare all 2021 journal entries and closing entries for the Flood Control Fund. b. Prepare the 2021 operating statement and the year-end balance sheet for the Flood Control Fund.

A debt service fund is used to report payments of principal and interest on bonds used for:

Local governments often have variable rate debt and hedge the related interest rate risk with an interest rate swap. These governments incur gains on these swaps when:

State and local governments often invest liquid assets on a short-term or long-term basis for income and capital gains. Which statement best describes the reporting for these investments, per SGAS 31?

Which of the following will not appear on the statement of net position of an enterprise fund?

The statement of cash flows reconciliation schedule for a proprietary fund would never include which adjustment?

Cuyahoga County plans to build a new courthouse in 2021 and sets up a capital projects fund to record activities related to its construction. All of the resources of the capital projects fund are restricted by external entities. The following events are recorded in the capital projects fund in 2021: •Total cost of the project is budgeted to be $750 million, and the county records a budget for the project. The funding is as follows: o State grant, $250 million o Bonds, $500 million •The state grant is accrued, and $200 million is received in cash. The remaining $50 million is expected to be received within 60 days of year-end. •The general fund provides temporary financing to the capital projects fund in the amount of $40 million. •The bonds are issued for $501 million. The extra $1 million is paid to the debt service fund. •The capital projects fund repays $38 million to the general fund and expects to pay back the remaining $2 million within 60 days of year-end. •Excess cash of $300 million is invested in low-risk securities. Income received in cash from investments is $8 million, of which $6.5 million is paid to the debt service fund. Income earned but not paid as of year-end is $0.5 million, but it is not expected to be received in cash until 6 months after year-end. The investments are worth $310 million at year-end. •Contracts totaling $700 million are awarded, and contractors submit bills for $400 million during the year. The county has paid $375 million of the bills in cash by year-end. Required Prepare the 2021 operating statement and 2021 year-end balance sheet for the capital projects fund, in proper format. Display all dollar amounts in millions.

Cumberland County PA has a Mental Health and Intellectual and Developmental Disabilities special revenue fund that accounts for services provided to county residents. Resources are provided by federal and state grants. The fund reports what category(ies) of fund balance?

Use the following information to answer questions bellow. Listed bellow are accounts of a state lottery at year-end, as reported in the state's enterprise fund: Dr (Cr) Current assets \ 5,000 Long-term investments 7,000 Long-term prizes payable (6,900) Current liabilities (4,800) Long-term pension liabilities (13) Net position restricted for future prizes (200) Deferred outflows for pensions 12 Deferred inflowsfor pensions (8) -On the lottery's year-end statement of net position, the balance for unrestricted net position is:

A county remits $5 million of property tax collections to the capital projects fund for use in construction projects. The capital projects fund records the cash received as

A governmental fund issues 3% bonds for $15,000,000 and uses this money to refund 5% bonds currently carried at $14,900,000. How is this reported by the governmental fund?

Listed below are accounts of the City University of New York for the year ended March 31, 2017, as reported in the State's enterprise fund (in millions): Dr (Cr) Current assets \ 1,727 Deferred outflows: Deriwatives activities 78 Accrued noncurrent liabilities (79) Intangible assets, net 224 Deferred outflows: Deferred loss on refunding 33 Land, const ruction in progress, and artwork 1,972 Other no ncurrent assets 479 Current liabilities (1,339) Restricted net position (314) Buildings and equipment, net 2,721 Noncurrent deriwative instruments (78) Noncurrent lease obligations (4,476) Noncurrent pension and oPEB liabilities (1,744) Net investment in capital assets (474) Deferred outflows: pensions 290 Deferred inflows: pensions (131) Required Prepare a statement of net position, in good form, for the City University of New York, for the year ended March 31, 2017.

At the beginning of the year, a special revenue fund purchases equipment for $400,000 in cash. The equipment has a 5-year life, straight-line. The fund still holds the equipment at year-end. How is this equipment reported in the special revenue fund's operating statement for the year?