At the End of Its Fiscal Year, the City of Lancaster

Short Answer

At the end of its fiscal year, the City of Lancaster owes public safety workers $18,000 and general government employees $12,000 for work performed related to General Fund activities prior to its December 31^st fiscal year end. The employees are not paid until January 10^th of the following year. What journal entry, if any, should the City of Lancaster make to record this transaction in its General Fund on December 31^st?
a.
$\begin{array}{lll}\text { Salaries expense-public safety } & 18,000 & \\\text { Salaries expense-general government } & 12,000 & \\\quad \text { Accrued salaries payable } & & 30,000\end{array}$

b.
$\begin{array}{lll} \text {Encumbrances--salaries}&30,000\\ \text {Budgetary fund balance reserved for encumbrances}&&20,000\end{array}$

c.
$\begin{array}{ll}\text { Expenditures-public safety salaries } & 18,000 \\\text { Expenditures-general government salaries } & 12,000 \\\text { Accrued salaries navable } &&30,000\end{array}$

d. No entry is required because this transaction relates to an activity accounted for in the General Fund.