Exam 19: An Introduction to Accounting for State and Local Governmental Units

Under the modified accrual basis of accounting, revenues are recognized in the period

The following are transactions for the city of Franklin. a. Borrowed $20,000 by issuing a two-year note. b. Purchased equipment for $6,000 cash. c. Licenses for $700 were billed on account. d. Accrued employee salary costs of $7,000. e. Depreciation expense on equipment for year, $1,000. Required: Analyze the above transactions by using the accounting equation for a proprietary fund.

What funds are reported in Government-wide financial statements?

The following are transactions for the city of Salem. a. Incurred salaries of $44,000 to be paid next month. b. Tax bills totaling $500,000 mailed to city residents. c. Paid salaries above. d. Computer equipment received in the amount of $11,000, to be paid in 30 days. Required: Analyze the above transactions by using the accounting equation for a governmental fund.

The following are transactions for the city of Springfield. a. Borrowed $20,000 by issuing a three-month, 5% note. b. Paid $4,000 for equipment. c. Services for $1,000 were billed and collected. d. Year-end accrual of 3 months interest on note in (a). Required: Analyze the above transactions by using the accounting equation for a governmental fund.

Government-wide financial statements exclude the

Government-wide financial statements include a

The accounting equation for an agency fund is

For each of the following transactions that could be introduced to fund the maintenance of the city park, state the type of fund(s) that would be affected. Assume that a capital project fund will be used to handle any long-term improvements or additions to the park. 1. Resources used to make 60 monthly installments on outstanding long-term debt. 2. Implemented a tax on alcohol purchases specifically designated for the park upkeep. 3. A local sports organization that uses the park raises funds and donates the money, stating that the principal may not be spent, but designating earnings to the park upkeep. 4. City council approves the funds from existing resources for the upkeep required in the upcoming year. 5. Resources used only to pay principal and interest of debt outstanding to finance park maintenance.

For each of the following events or transactions, identify the type of fund(s) that will be affected. 1. A central purchasing department was established to handle all the purchasing needs of a county government. 2. A county government levies sales taxes restricted as to use for job creation. 3. A county government receives a large contribution specifying that income from the contribution be distributed each year to the county zoo. The principal is to remain intact indefinitely. 4. A city government paid construction costs of $12,000 on city hall building. 5. A city government paid general operating costs.

The following are transactions for the city of Springfield. a. Borrowed $20,000 by issuing a three-month, 5% note. b. Paid $4,000 for equipment. c. Services for $1,000 were billed and collected. d. Year-end accrual of 3 months interest on note in (a). Required: Analyze the above transactions by using the accounting equation for a proprietary fund.

Match each of the following fund types to one of the following three fund categories as indicated. Each fund category may be used more than once.

A comprehensive annual financial report has the following three major sections:

The following are transactions for the city of Franklin. a. Borrowed $20,000 by issuing a two-year note. b. Purchased equipment for $6,000 cash. c. Licenses for $700 were billed on account. d. Accrued employee salary costs of $7,000. e. Depreciation expense on equipment for year, $1,000. Required: Analyze the above transactions by using the accounting equation for a governmental fund.

Governmental fund financial statements are prepared on the ________ basis of accounting. Proprietary fund financial statements are prepared on the ________ basis of accounting.

When examining revenue transactions, which of the following transactions is classified as an exchange transaction?

The following are transactions for the city of Salem. a. Incurred salaries of $44,000 to be paid next month. b. Tax bills totaling $500,000 mailed to city residents. c. Paid salaries above. d. Computer equipment received in the amount of $11,000, to be paid in 30 days. Required: Analyze the above transactions by using the accounting equation for a proprietary fund.

The accounting equation for a governmental fund is

The following are transactions for the city of Greenville. a. Issued $50,000 10-year bonds. b. Used $30,000 of the cash to buy a truck. c. Sold the truck that was replaced which had cost $28,000, for $2,000. The old truck was fully depreciated. Residual value is zero. d. Computed depreciation on the new truck for the year of $6,000. Required: Analyze the above transactions by using the accounting equation for a proprietary fund.

The modified accrual basis of accounting is used for