Question

The following transactions relate to the General Fund of the City of Buffalo Falls for the year ended December 31, 2020: 1. Beginning balances were: Cash, $80,000; Taxes Receivable, $185,000; Accounts Payable, $50,000; and Fund Balance, $215,000. 2. The budget was passed. Estimated revenues amounted to $1,200,000 and appropriations totaled $1,196,000. All expenditures are classified as General Government 3. Property taxes were levied in the amount of $902,000. All of the taxes are expected to be collected before February 2021. 4. Cash receipts totaled $870,000 for property taxes and $275,000 from other revenue. 5. Contracts were issued for contracted services in the amount of $90,000. 6. Contracted services were performed relating to $82,000 of the contracts with invoices amounting to $80,000. 7. Other expenditures amounted to $950,000. 8. Accounts payable were paid in the amount of $1,070,000. 9. The books were closed. Required: a. Prepare journal entries for the above transactions. b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the General Fund. c. Prepare a Balance Sheet for the General Fund assuming there are no restricted or assigned net resources and outstanding encumbrances are committed by contractual obligation. Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare journal entries for the above transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" the first account field.) View transaction list Journal entry worksheet < 1 2 3 4 5 6 7 8 .... 12 > Beginning balances were: Cash, $80,000; Taxes Receivable, $185,000; Accounts Payable, $50,000; and Fund Balance, $215,000. Note: Enter debits before credits. Transaction General Journal Debit Credit 01 Record entry Clear entry View general journal

Answer 1

debit $ $ Transact General Journal 1 Cash A/C Tax Receivable A/C To Account Payable A/C To Funds Bal A/C (Being Opening Balance entered) credit 80,000 185,000 $ $ 50,000 215,000 2 No Journal Entry required $ 902,000 3 Tax Receivable A/C To Property Taxes Revenue A/c (Being Property Taxes levied and booked) $ 902,000 $ 1,145,000 4 Cash A/C To Tax Receivable A/C To Other Revenue A/C $ $ 870,000 275,000 (being cash received from taxes receivables and other services performed) 5 No Journal Entry required 6 Cash A/C Contract Receivables A/C To Contract Revenue A/C $ $ 80,000 2,000 $ 82,000 (being 80000 cash received for contract performed and 2000 is pending for contract performed) $ 950,000 7 Expenditures A/C To Account Payable A/C (being expensed booked for expenses) $ 950,000 $ 1,070,000 8 Account Payable A/C To Cash A/C (being Service providd to Elks lodge men) $ 1,070,000

CITY OF BUFFALO FALLS - GENERAL FUNDS STATEMENT OF REVENUE, EXPENDITURES AND CHANGE IN FUND BALACE FOR THE PERIOD ENDED DEC 31,2020 REVENUE: Property Taxes Revenue A/c $ 902,000 Other Revenue A/C $ 275,000 Contract Revenue A/C $ 82,000 TOTAL REVENUE $ 1,259,000 EXPENSES: Expenditures A/C $ 950,000 TOTAL EXPENSES $ $ 950,000 309,000 Other Financing Source (Uses) Total Other Financing Source (Uses) Net Change in Fund Balance Fund Balance January 1 Fund Balance December 31 $ $ $ 309,000 215,000 524,000

CITY OF BUFFALO FALLS GENERAL FUNDS Balance Sheet As at DEC 31,2020 Assets : Cash A/C Tax Receivable A/C Contract Receivables A/c Advanced Paid (Account Payable A/c) Total Assets Liabilities, Deffered Infows & Fund Balances Liabilities: 235000 217000 2000 70000 524,000 $ $ Total Liabilities Fund Balances : Fund Balance December 31 524000 Total Fund Balances Total Liabilities, Deffered Infows & Fund Balances $ $ 524,000 524,000

Dear student/sir,

I have taken into account accrual accounting. I treated contract service as revenue and Account Payable balance become negative due to excess payment so I consider the same as Advanced paid.

Do let me know in case of any clarification.

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