Question

The state government established a capital project fund in 2016 to build new highways. The fund is supported by a 5 percent tax on diesel fuel sales in the state. The tax is collected by private gas stations and remitted in the following month to the State. The following transactions occurred during 2017:

Capital Project Fund Trial Balance:

December 31, 2016

Debits Credits

Cash $8,700,000

Taxes Receivable 2,550,000

Contracts Payable $1,875,000

Fund Balance 9,375,000

1. $2,100,000 of encumbrances outstanding at December 31, 2016, were re-established.

2.During the year, fuel taxes were remitted to the State totaling $23,600,000, including the amount due at the end of the previous year. In addition, $2,900,000 is expected to be remitted in January of next year for fuel sales in December 2017.

3. The State awarded new contracts for road construction totaling $23,650,000.

4. During the year, contractors submitted invoices for payment totaling $24,005,000. These were all under the terms of contracts (i.e., same $ amounts) issued by the State.

5. The State made payments on outstanding accounts of $23,375,000.

The state government operates a debt service fund to service outstanding general obligation bonds. The following transactions occurred during 2017:

Debt Service Fund Trial Balance:

December 31, 2016

Debits Credits

Cash $175,000

Fund Balance $175,000

6. The state General Fund provided cash of $4,800,000 through transfer to the debt service fund.

7. Payments for matured interest totaled $2,985,000 and payments for matured principal totaled $1,850,000 during the year.

8. In December, the State refunded bonds to obtain a better interest rate. New bonds were issued providing proceeds of $20,000,000, which was immediately used to retire outstanding bonds in the same amount.

Required:

Use the Excel template provided. A separate tab is provided in Excel for each of the requirements:

a. Prepare journal entries recording the events 1 to 8 (above) for the capital projects and debt service funds.

b. Post the journal entries to T-accounts.

c. Prepare closing entries.

d. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the Governmental Funds (the General Fund and special revenue fund financial statements have already been prepared).

e. Prepare a Balance Sheet for the Governmental Funds assuming all unexpended spendable net resources in the capital projects fund are classified as restricted and in the debt service fund are classified as assigned.

Answer 1

ANSWER

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back to you. Part c Capital Project Fund Credit Fuel tax revenues Fund balance Expenditures: Capital Outlay Debit $ 23,950,000 $ 55,000 $ 24,005,000 $ 1,745,000 Budgetary Fund Balance -- Reserve for Encumbrances Encumbrances $ 1,745,000 Part c Debt Service Fund $ 20,000,000 $ 4,800,000 $ 35,000 OFS- Bond refunding OFS - transfers in Fund balance reserved for debt service Expenditures-bond principal Expenditures - bond interest OFU-bond refunding $ $ $ 1,850,000 2,985,000 20,000,000 Part d General Fund Special Revenue Fund Capital Projects Fund Debt Service Fund Total Governmental Funds $- S - $ $ 63,500,000 5,680,000 $ 23.950.000 63,500,000 5,680,000 23,950,000 1,162,000 255,000 94,547,000 1,162,000 255,000 1,417,000 $ 69,180,000 $ $ 23,950,000 Revenues Income taxes Intergovernmental revenues Fuel taxes License Fees Fines Total Revenues Expenditures Current: General Government Operations Public Safety Tourism Wildlife Management Capital Outlay Debt Service Principal Interest Total Expenditures $ $ $ 27,890,000 27,200,000 8,770,000 27,890,000 27,200,000 8,770,000 1,293,300 24,310,000 1,293,300 305,000 $ 24,005,000 1,850,000 2,985,000 4,835,000 $ $ $ 1,850,000 2,985,000 94,298,300 $ 63,860,000 $ 1,598,300 $ 24,005,000 $ Excess (Deficiency) of Revenues Over Expenditures $ 5,320,000 $ (181,300) $ (55,000) $ (4,835,000) $ 248,700 Other financing sources (uses) Bond Refunding - proceeds Bond Refunding - payment Transfers in Transfers out total other financing sources (uses) $ $ $ 20,000,000 $ (20,000,000) $ 4,800,000 $ 20,000,000 (20,000,000) 5,100,000 (5,100,000) 300,000 $ (5,100,000) (5,100,000) $ $ $ 300,000 $ 4,800,000 (35,000) $ Net Change in Fund Balance Fund Balance, January 1 Fund Balance, December 31 $ $ $ 220,000 2,350,000 2,570,000 $ $ $ 118,700 252,000 370,700 $ $ $ (55,000) $ 9,375,000 $ 9,320,000 $ 248,700 12,152,000 12,400,700 140,000 $

Parte General Fund Special Revenue Fund Capital Projects Fund Debt Service Fund Total Governmental Funds $ $ 307,000 $ 8,925,000 $ 140,000 $ $ 2,900,000 Assets Cash Investment in US securities Taxes receivable - Licenses receivable Due from other governments Accrued interest receivable Supplies Inventory Total Assets $ 137,000 2,069,000 2,560,000 1,077,000 58,000 700,000 220,000 36,000 6,720,000 11,441,000 2,560,000 3,977,000 195,000 700,000 220,000 42,700 19,135,700 $ $ 6,700 450,700 $ $ 11,825,000 $ 140,000 $ Liabilities and Fund Balances Liabilities Accounts Payable Wages Payable Contracts payable $ $ 3,750,000 $ 400,000 $ 38,000 42,000 3,788,000 442,000 2,505,000 2,505,000 Total Liabilities $ 4,150,000 $ 80,000 $ 2,505,000 6,735,000 $ 36,000 $ 6,700 42,700 9,320,000 9,320,000 364,000 364,000 Fund Balances Nonspendable - supplies inventory Restricted for: New highways Fish and game Assigned to: Debt service Public works Unassigned Total Fund Balances 140,000 $ $ $ $ 34,000 2,500,000 2,570,000 $ 140,000 34,000 2,500,000 12,400,700 370,700 $ 9,320,000 $ 140,000 $ Total Liabilities and Fund Balances $ 6,720,000 $ 450,700 $ 11,825,000 $ 140,000 $ 19,135,700

Answer 2

on Part "e" where did you get the 9,320,000?