Exam 4: Accounting for the General and Special Revenue Funds

Resources appropriately reported within proprietary or fiduciary funds are excluded from special revenue funds.

The City of Stromfield had the following partial list of preclosing account balances in its General Fund as of June 30,2014. Required: Prepare,in good form,a Statement of Revenues,Expenditures,and Changes in Fund Balances for the General Fund for the year ended June 30,2014.

The City of Brownsville had a balance in the Budgetary Fund Balance -- Reserve for Encumbrances account at the end of 2013 in the amount of $90,000.During 2014,all purchase orders related to the $90,000 were filled,and the invoice amount was $91,200.Which of the following would be true regarding the Statement of Revenues,Expenditures,and Changes in Fund Balances for 2014? (assume encumbrances do not lapse)

Transactions between funds of the same government are assumed to be arm's length in nature because there is no private inurement.

Which of the following is true regarding the use of Special Revenue Funds?

When accounting for the General Fund,the Encumbrances Control account is credited when:

The journal entry to record the re-establishment of encumbrances that were outstanding at the close of the prior period would include:

Regarding interfund transactions,which of the following is not correct?

Only the General Fund may have a positive Unassigned Fund Balance

The Town of Little River expects to collect $90,000 in sales tax from the state government within 30 days of the end of fiscal year 2014 for retail sales taking place in fiscal year 2014.What entry,if any,would Little River make at the end of 2014?

The following information was available for the General Fund of the City of Thomasville for the Year Ended December 31,2014: (a)Revenues for the year included property taxes in the amount of $6,612,000,fines and forfeits in the amount of $ 700,000,and miscellaneous in the amount of $400,000. (b)Expenditures from current appropriations included: general government,$4,847,000; public safety,$1,924,000; culture and recreation,812,000. (c)In addition to (b)above,expenditures related to prior year appropriations (encumbered last year)amounted to $40,000 (public safety).Encumbrances issued this year but not filled amounted to $60,000 (general government). (d)A transfer was made from the General Fund to a debt service fund in the amount of $500,000.A transfer was made from an enterprise fund to the General Fund in the amount of $450,000. (e)A sale of park land was made during the year,which was considered infrequent but not unusual and under the control of management.The proceeds amounted to $126,000,and the land had a basis of $90,000 reported in the government-wide Statement of Net Assets the year before. (f)Beginning balances included Fund Balance in the amount of $222,000. Required: Prepare a Statement of Revenues,Expenditures,and Changes in Fund Balances for the General Fund for the City of Thomasville for the Year Ended December 31,2014.

Which of the following is true regarding modified accrual accounting?

The Village of Naples has $19,000 of purchase orders outstanding at the end of 2013 which will be honored.The goods and supplies were received during the second week of January,2014.The invoice amounted to $18,800 What are the journal entries necessary to re-establish the encumbrance and record receipt of the supplies?

Under the modified accrual basis of accounting,GASB standards for property tax revenue recognition provide that revenue should not be recognized for property taxes collected:

Prepare entries in general journal form to record the following transactions in General Fund general ledger accounts for fiscal year 2014.Use modified accrual accounting. (a)The legal budget for the year provided for $5,000,000 of estimated revenues and $4,960,000 appropriations. (b)Assume there are $ 210,000 of purchase orders outstanding at the end of last year and that these will be honored in the current year.Prepare the entries to re-establish the encumbrance. (c)Property taxes were levied in the amount of $3,300,000.It is estimated that 2 percent of the taxes will never be collected. (d)Purchase orders were issued for equipment and supplies in the amount of $4,000,000. (e)Supplies,relating to all of the prior year purchase orders ($210,000),were received along with invoices amounting to $207,000. (f)Collections of current property taxes amounted to $2,950,000.The uncollected taxes recorded as delinquent. (g)It was estimated that $210,000 in property taxes would be collected in the first 60 days of 2015 and that $160,000 would be collected in later periods.

Which account would be debited when the City of Corfu issued purchase orders for materials and supplies?

After closing entries,a special revenue fund's Fund Balance account represents the net amount of resources available for future appropriation

Nonreciprocal interfund activity:

Governmental fund financial statements are prepared using the accrual basis of accounting.

When payrolls and other liabilities are incurred and must be paid before substantial amounts of cash will be collected,what type of short-term note is desirable and secured by a government's power to tax?