Question

Problem II. (30 points). Part I. The city council of Gandy, WI, population 301,277, passed its 2020 fiscal year budget (July 1, 2019 to June 30, 2020). Gandy has a high unemployment rate for Wisconsin, as a major manufacturing plant shut down and moved to lower-costing Texas. For fiscal year 2019, Gandy closed the fiscal year with an operating deficit of $590,000. Fund Balance-Unassigned at June 30, 2019 before applying the operating deficit, was $965,000. Gandy has the following FY 2020 budget adoption information: $ Estimated Revenues: Property Taxes Fines and Forfeits Charges for Services Miscellaneous Revenues Totals 1,214,000 108,000 389,600 119,000 S 1,830,600 Appropriations: Education Public Safety Public Works General Government Totals 839,600 1,425,000 633,700 1,879,000 4,777,300 $ Estimated Other Financing Sources: Transfers from State of WI Proceeds from bond issue $ 3,645,300 1,000,000 4,645,300 Estimated Other Financing Uses: Transfers to Debt Services Fund $ 2,050,000 Instructions: 1. Prepare the entry to adopt the FY 2020 budget. Ignore subsidiary ledgers.

Answer 1

Please find below table useful to compute desired results: -

D Credit B C 1 Date Account titles and Explanation Debit Estimated Revenue =C10 Budgetary Fund Balance =C14 Estimated Apportions (to record adoption of budget) =C13 Calculation of Surplus/Deficit Estimated Revenue 1830600 Estimated other financing source 4645300 Total =C8+C9 Appropriations 4777300 Estimated other financing issues 2050000 Total I=C11+C12 Deficit I=C13-C10

End results would be as follows: -

B 1 Date Account titles and Explanation Debit Credit Estimated Revenue $6,475,900 Budgetary Fund Balance $351,400 Estimated Apportions $6,827,300 (to record adoption of budget) Calculation of Surplus Deficit Estimated Revenue $1,830,600 Estimated other financing source 84,645,300 Total $6,475,900 Appropriations $4,777,300 Estimated other financing issues $2,050,000 Total $6,827,300 Deficit $351,400