Fund A transfers $20,000 to Fund B. For each of the following, indicate whether the statem...

Fund A transfers $20,000 to Fund B. For each of the following, indicate whether the statement is true or false and, if false, explain why.

a.If Fund A is the General Fund and Fund B is an Enterprise Fund, nothing will be shown for this transfer on the statement of activities within the government-wide financial statements.

b.If Fund A is the General Fund and Fund B is a Debt Service Fund, nothing will be shown for this transfer on the statement of activities within the government-wide financial statements.

c.If Fund A is the General Fund and Fund B is an Enterprise Fund, a $20,000 reduction will be reported on the statement of revenues, expenditures, and other changes for the governmental funds within the fund-based financial statements.

d.If Fund A is the General Fund and Fund B is a Special Revenue Fund (which is not considered a major fund), no changes will be shown on the statement of revenues, expenditures, and other changes within the fund-based financial statements.

e.If Fund A is the General Fund and Fund B is an Internal Service Fund and this is for work done, the General Fund will report an expense of $20,000 within the fund-based financial statements.

Use the following information for Problems 46-52:

Assume that the City of Coyote has already produced its financial statements for December 31, 2010, and the year then ended. The city’s General Fund was only for education and parks. Its Capital Projects Funds worked with each of these functions at times. The city also had established an Enterprise Fund to account for its art museum.

The government-wide financial statements indicated the following figures:

• Education reported net expenses of $600,000.

• Parks reported net expenses of $100,000.

• Art museum reported net revenues of $50,000.

• General government revenues for the year were $800,000 with an overall increase in the city’s net assets of $150,000.

The fund-based financial statements indicated the following for the entire year:

• The General Fund reported a $30,000 increase in its fund balance.

• The Capital Projects Fund reported a $40,000 increase in its fund balance.

• The Enterprise Fund reported a $60,000 increase in its net assets.

The CPA firm of Abernethy and Chapman has been asked to review several transactions that occurred during 2010 and indicate how to correct any erroneous reporting and the impact of each error. View each situation as independent.