Question

Prepare journal entries for a local government to record the following transactions, first for fund financial statements and then for government-wide financial statements. a. The government sells $1,098,000 in bonds at face value to finance construction of a warehouse. b. A $1.18 million contract is signed for construction of the warehouse. The commitment is required if allowed. c. A $210,000 transfer of unrestricted funds was made for the eventual payment of the debt in (a) d. Equipment for the fire department is received with a cost of $16,840. When it was ordered, an anticipated cost of $16,200 had been recorded. e. Supplies to be used in the schools are bought for $2,050 cash. The consumption method is used. f. A state grant of $113,000 is awarded to supplement police salaries. The money will be paid to reimburse the government after the supplement payments have been made to the police officers. g. Property tax assessments are mailed to citizens of the government. The total assessment is $725,000, although officials anticipate that 4 percent will never be collected. There is an enforceable legal claim for this money and the government can use it immediately Prepare journal entries for a local government funds to record the fund financial statements. (Select the appropriate fund for each situation when required. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Transaction Fund/Activity General Journal Debit Credit a. The government sells $1,098,000 in bonds at face value to finance construction of a warehouse. a. Record sale of bonds. b. A $1.18 million contract is signed for construction of the warehouse. The commitment is required if allowed. b. Record contract for construction of warehouse c. A $210,000 transfer of unrestricted funds was made for the eventual payment of the debt in (a). C. General fund Record transfer of unrestricted fund. Record transfer of unrestricted fund. d. Equipment for the fire department is received with a cost of $16,840. When it was ordered, an anticipated cost of $16,200 had been recorded Record encumbrances outstanding. Record receipt of equipment. e. Supplies to be used in the schools are bought for $2,050 cash. The consumption method is used. e. Record supplies bought for cash. f. A state grant of $113,000 is awarded to supplement police salaries. The money will be paid to reimburse the government after the supplement payments have been made to the police officers. Record the grant revenue fund g. Property tax assessments are mailed to citizens of the government. The total assessment is $725,000, although officials anticipate that 4 percent will never be collected. There is an enforceable legal claim for this money and the government can use it immediately. Record property tax assessments Prepare journal entries for a local government funds to record the government-wide financial statements. (Select the appropriate fund for e situation when required. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Transaction Fund/Activity General Journal Debit Credit a. The government sells $1,098,000 in bonds at face value to finance construction of a warehouse. Record sale of bonds b. A $1.18 million contract is signed for construction of the warehouse. The commitment is required if allowed Record contract for construction of warehouse. c. A $210,000 transfer of unrestricted funds was made for the eventual payment of the debt in (a) Record transfer of unrestricted fund. d. Equipment for the fire department is received with a cost of $16,840. When it was ordered, an anticipated cost of $16,200 had been recorded. Record receipt of equipment. e. Supplies to be used in the schools are bought for $2,050 cash. The consumption method is used Record supplies purchased for cash. f. A state grant of $113,000 is awarded to supplement police salaries. The money will be paid to reimburse the government after the supplement payments have been made to the police officers Record the grant revenue. g. Property tax assessments are mailed to citizens of the government. The total assessment is $725,000, although officials anticipate that 4 percent will never be collected. There is an enforceable legal c or this money and the government can use it immediately. Record property tax assessments. FUND FIN STMT GOVT WIDE FIN STMT

Answer 1

Local Government Fund Financial Statements Journal Enteries EventParticulars Debit in $ Credit in $ a. Cash a/c Dr. 1098000 To Other Financial Sources - Bonds Proceeds 1098000 To record sale of Bond b. Encumbrances a/c Dr. 1180000 To Fund Balance reserved for encumbrances 1180000 (Contract signed) Other Financing Uses-Transfers Out a/c (Payment of debt) Cash a/c (Payment of debt) c. Dr 210000 To Cash 210000 Dr. 210000 To Other Financing Uses - Transfers In 210000 d. Fund Balance - Reserved for Encumbrances a/c Dr 16200 To Encumbrances 16200 (Anticipated cost for fire department recorded) Encumbrances Control - Machinery & Equip a/c Dr (Actual cost 16840 To Vouchers Payable 16840 e. Inventory of Supplies a/c To Cash Dr. 2050 2050 Supplies purchased for cash f. Cash a/c Dr. 113000 To Deferred Revenues 113000 (State grant for police salaries Taxes Receivable a/c Dr. 725000 To Revenues Pro Taxes 696000 To Allowance for Uncollectible current taxes 29000 (Property Taxes accrued)

Government wide Financial Statements Journal Enteries EventParticulars Debit in $ Credit in $ a. Cash a/c Dr. 1098000 To Bonds Payable 1098000 To record sale of Bond No entry required C. No entry required d. Machinery and Equipment a/c Dr 16840 To Vouchers of Account Pavable 16840 (Actual cost e. Inventory of Supplies a/c To Cash Dr. 2050 2050 Supplies purchased for cash f. Cash a/c Dr. 113000 To Deferred Revenues 113000 (State grant for police salaries Taxes Receivable a/c Dr. 725000 To Revenues Pro Taxes 696000 To Allowance for Uncollectible current taxes 29000 (Property Taxes accrued)