The Town of Drexel has the following financial transactions.
1. The town council adopts an annual budget for the General Fund estimating general revenues of $1.7 million, approved expenditures of $1.5 million, and approved transfers out of $120,000.
2. The town levies property taxes of $1.3 million. It expects to collect all but 3 percent of these taxes during the year. Of the levied amount, $40,000 will be collected next year, after more than 60 days.
3. The town orders two new police cars at an approximate cost of $110,000.
4. A transfer of $50,000 is made from the General Fund to the Debt Service Fund.
5. The town pays a bond payable of $40,000 along with $10,000 of interest using money previously set aside.
6. The Town of Drexel issues a $2 million bond at face value to acquire a building to convert into a high school.
7. The two police cars are received with an invoice price of $112,000. The voucher has been approved for this amount but not yet been paid.
8. The town acquires the building for the high school for $2 million in cash and immediately begins renovating it.
9. Depreciation on the new police cars is computed as $30,000 for the period.
10. The town borrows $100,000 on a 30-day tax anticipation note.
11. The Town of Drexel begins a special assessment curbing project. The government sells $800,000 in notes at face value to finance this project. The town has pledged to guarantee the debt if the assessments collected do not cover the entire balance.
12. A contractor completes the curbing project and is paid $800,000.
13. The town assesses citizens $850,000 for the completed curbing project.
14. The town collects the special assessments of $850,000 in full and repays the debt plus $50,000 in interest.
15. The town receives a $10,000 cash grant to beautify a local park. The grant must be used to reimburse specific costs that the town incurs.
16. The town spends $4,000 to beautify the park.
a. Prepare journal entries for the town based on the production of fund-based financial statements.
b. Prepare journal entries in anticipation of preparing government-wide financial statements.