Exam 20: Accounting for State and Local Governmental Units - Governmental Funds

The City of Attross entered the following transactions during 2014: 1. The city authorized a bond issue of $2,500,000 par to finance construction of a fountain and pavilion in the city square. The bonds were issued for $2,560,000. The premium was transferred to the fund for which the debt will be serviced. (This was a nonreciprocal transfer.) 2. The city entered into a contract for construction of the fountain at an estimated cost of $2,425,000. 3. The city received and paid a bill for $2,445,000 from the contractor upon completion of and approval of the fountain. 4. The unused bond proceeds were set aside for debt service on the bonds. Accordingly, those resources were paid to the appropriate fund(nonreciprocal). Required: Prepare journal entries for each of the above transactions. Identify the appropriate fund or funds used by Attross.

Carson County had the following transactions for their General Fund relating to the levy and collection of property taxes. 1. Property tax bills for $1,000,000 are sent to property tax owners. Taxes are due in 45 days. History shows that Carson County should expect 1.5% of the property taxes to be uncollectible. 2. $850,000 in property taxes is collected. The remaining receivables are past due. 3. An additional $80,000 of the delinquent taxes is collected. 4. Wrote off $10,000 of delinquent taxes determined to be uncollectible. Required: Prepare the journal entries in the General Fund for the transactions.

A Capital Projects Fund awards the construction of a building to a construction contractor at a contract cost of $1,000,000. What entry is prepared by the Capital Projects Fund?

When the interest income of $50,000 is received, what account should be credited?

Old West City had the following transactions in fiscal 2014. Assume that all expenditures were properly appropriated in the fiscal 2014 budget. 1. A six-month loan was made to the special revenue fund from the general fund amounting to $28,000. 2. A purchase order for landscaping maintenance services was issued in the amount of $43,000. 3. A $10,000 nonreciprocal transfer was made to the debt service fund to pay interest amounts outstanding. 4. The final invoice for landscaping maintenance was received in the amount of $39,000, and it was scheduled to be paid in 30 days. 5. The city enters into a capital lease of fixed assets for the general government. The present value of the minimum lease payments equals $70,000. Required: Prepare the journal entries for the General Fund.

Prepare journal entries to record the following grant-related transactions for a municipality's special revenue fund. 1. Special Revenue Fund awarded an operating grant from the state, $2,500,000 (cash will be received after qualified expenditures are made). 2. Special Revenue Fund received funds of $1,600,000, temporarily transferred from the General Fund. 3. Incurred qualifying expenditures on the state grant program of $1,600,000 and paid them with funds temporarily transferred from the General Fund. 4. Received a federal grant to finance planting of trees in city, $4,500,000 (cash received in advance). 5. Incurred and paid cost of $3,000,000 for planting 10,000 trees in city.

The proceeds from a bond issuance for the construction of a new public school should be recorded in the ________ fund at the time the bonds are sold. At the time of the bond issue, the debit is to cash and the credit is to ________.

The trial balance for the General Fund for Golden City held the following balances at June 30, 2014, just before closing entries were made: Required: Prepare the necessary closing entries.

The proper sequence of events is

Middlefield County incurred the following transactions during 2014: 1. The county authorized a new general obligation bond issue of $5 million par to construct an office building with a contract price of $4,975,000. The bonds were issued for $4,980,000. 2. The county levied real property taxes of $10,000,000. Eighty-five percent of the net taxes were collected immediately. Two percent of the total levy was estimated to be uncollectible. 3. The office building was completed and the county paid the contract price to the contractor. 4. The General Fund transferred $500,000 to the Debt Service Fund. 5. The county paid $200,000 for interest on the bonds from the Debt Service Fund. Required: Prepare journal entries for each of the above transactions. Identify the appropriate fund or funds used by Middlefield County.

The following information regarding the fiscal year ended September 30, 2014, was drawn from the accounts and records of the Mayberry County general fund: Required: Prepare a statement of revenues, expenditures, and changes in fund balance for the Mayberry County general fund for the year ended September 30, 2014.

Which of the following funds has similar accounting and reporting to the special revenue fund?

The City of Electri entered the following transactions during 2014: 1. Borrowed $120,000 for a six-month term, to be paid upon receipt of property tax payments which were previously billed. 2. Used the funds borrowed to purchase a new fire truck. The truck is expected to have a 15-year useful life, and a $5,000 residual value. 3. Received $90,000 cash from a state grant. Funds are restricted for the purchase of a second fire truck. 4. Used the grant funds received to purchase a second fire truck. The truck is expected to have a 15-year useful life, and a $5,000 residual value. 5. Nonreciprocal transfer of $50,000 to the Debt Service Fund to be used toward repayment of the note. Required: Prepare the journal entries in the General Fund for the transactions.

A pre-closing trial balance included the following account balances for Simpli City: Required: Prepare the necessary closing entries for the General Fund.

Taxes which were billed, but are not paid by the due date, require which of the following entries at the fiscal close?

The general fund trial balance for Lakeview City held the following balances at September 30, 2014, just before closing entries were made: Required: Prepare the necessary closing entries for the General Fund.

The General Fund transfers $50,000 cash to the Debt Service Fund to meet annual interest payments. What entry did the Debt Service Fund prepare?