Following are descriptions of transactions and other financial events for the City of Tetris for the year ending December 2010. Not all transactions have been included here. Only the General Fund formally records a budget. No encumbrances were carried over from 2009.
|Paid salary for police officers||$21,000|
|Received government grant to pay ambulance drivers||40,000|
|Received invoices for rent on equipment used by fire department|
during last four months of the year
|Paid for newly constructed city hall||1,044,000|
|Made commitment to acquire ambulance||111,000|
|Received cash from bonds sold for construction purposes||300,000|
|Placed order for new sanitation truck||154,000|
|Paid salary to ambulance driversâ€”money derived from state|
government grant given for that purpose
|Paid for supplies for school system||16,000|
|Made transfer from General Fund to eventually pay off a long-term debt||33,000|
|Received but did not pay for new ambulance||120,000|
|Levied property tax receivables for 2010 City anticipates that|
|95 percent ($190,000) will be collected during the year and 5 percent|
will be uncollectible
|Acquired and paid for new school bus||40,000|
|Received cash from business licenses and parking meters|
(not previously accrued)
The following questions are independent although each is based on the preceding information. Assume that the government is preparing information for its fund-based financial statements.
a. What is the balance in the Budgetary Fund Balance account for the budget for the year? Is it a debit or credit?
b. Assume that 60 percent of the school supplies are used during the year so that 40 percent remain. If the consumption method is being applied, how is this recorded?
c. The sanitation truck that was ordered was not received before the end of the year. The commitment will be honored in the subsequent year when the truck arrives. What reporting is made at the end of 2010?
d. Assume that the ambulance was received on December 31, 2010. Provide all necessary journal entries on that date.
e. Give all journal entries that should have been made when the $33,000 transfer was made to eventually pay off a long-term debt.
f. What amount of revenue would be recognized for the period? Explain the composition of this total.
g. What are the total expenditures? Explain the makeup of this total. Include (b) here.
h. What journal entry or entries were prepared when the bonds were issued?