8-13. The fund-basis financial statements of Jefferson County have been completed for the year 2017 and appear in the first tab of the Excel spreadsheet provided with this exercise. The following information is also available: a Capital Assets Capital assets purchased in previous years through governmental-type funds totaled $7,890,000 (net of accumulated depreciation) as of January 1. Depreciation on capital assets used in governmental-type activities amounted to $316,000 No capital assets were sold or disposed of and all purchases are properly reflected in the fund-basis statements as capital expenditures. b. Long-Term Debt There was no outstanding long-term debt associated with governmental-type funds as of January 1. April 1, 6 percent bonds with a face value of $700,000 were issued at a premium. Bond payments are made on October 1 and April 1 of each year. Interest is based on an annual rate of 6 percent, and principal payments are $22,000 each. The first payment (interest and principal) was made on October 1. Amortization of the bond premium for the current year is $1,800 c. Deferred Inflows of Resources Deferred inflows (comprised solely of property taxes) are expected to be collected more than 60 days after year-end. The balance of deferred taxes at the end of 2016 was $19,500. d. Transfers Page 257 Transfers were between governmental-type funds. E. Internal Service Fund The (motor pool) internal service fund's revenue is predominantly derived from departments classified as governmental-type activities There were no amounts due to the internal service fund from the General Fund. The outstanding balance of Due to Other Funds was with the enterprise fund and is not capital related. The enterprise fund provided a long-term advance to the internal service fund (not capital related). Required: Use the Excel template provided to complete the following requirements; a separate tab is provided in Excel for each of these steps 1. Prepare the journal entries necessary to convert the governmental fund financial statements to the accrual basis of accounting. 2. Post the journal entries to the conversion worksheet provided 3. Prepare a government-wide Statement of Activities and Statement of Net Position for the year 2017. All of the governmental fund revenues are "general revenues. This is an involved problem, requiring many steps. Here are some hints. a. Tab 1 is information to be used in the problem. You do not enter anything here. b. After you make the journal entries (Tab 2), post these to the worksheet to convert to the accrual basis. This worksheet is set up so that you enter debits as positive numbers and credits as negative. After you post your entries, look at the numbers below the total credit column to see that debits equal credits. If not, you probably entered a credit as a positive number c. Make sure that total debits equal total credits in the last column (balances for government-wide statements) d. When calculating Restricted Net Position, recall that permanent fund principal is added to restricted fund balances. 8-14 The fund-basis financial statements of the City of Cottonwood have been completed for the year 2017 and appear in the first tab of the Excel spreadsheet provided with this exercise. In addition, the government-wide Statement of Net Position from the previous fiscal year is provided and should be used to determine beginning balances for accounts not appearing in the fund basis statements. The following information is also available: a Capital Assets Capital assets purchased by governmental funds are charged to capital expenditure and do not appear as assets in the fund-basis balance sheet. However, the balance is reflected in the Statement of Net Position in the government-wide financial statements Depreciation on capital assets used in governmental-type activities amounted to $3,100,000 for the year Page 258 No capital assets were sold or disposed of and all purchases are properly reflected in the fund-basis statements as capital expenditures. b. Long-Term Debt Proceeds from bonds issued by governmental funds are reflected in other financing sources and do not appear as liabilities in the fund-basis balance sheet. Payments of principal are recognized as expenditures when due. The balance of outstanding bonds balance is reflected in the Statement of Net Position in the government-wide financial statements. Interest is recognized in the fund-basis statements only when payment is due. Interest accrued but not yet payable amounted to $167,000 at December 31, 2017. Interest accrued for purposes of the government-wide statements in 2016 has been paid and is reflected in interest expenditure in 2017. There are no bond discounts or premiums. c. Deferred Inflows of Resources Deferred inflows are comprised solely of property taxes expected to be collected more than 60 days after year-end The balance of deferred taxes at the end of 2016 was $188,400 and was recognized as revenue in the fund-basis statements in 2017 d. The City accounts for its solid waste landfill in the General Fund (public works department). The estimated liability for closure and postclosure care costs as of December 31, 2017, is $2,600,000 and appears only in the government-wide statements e. Transfers During the year, the General Fund transferred cash to the courthouse renovation, debt service, and enterprise funds f The City does not operate any internal service funds. 3. When entering amounts in the Statement of Activities, Charges for Services Revenue in the governmental funds is attributable to the following functions: General Government $1,156,497 44,018 Judicial Administration Public Safety 275,492 604,359 Parks and Recreation Community Development 51,611 $2,131.977 Total 8-13. The fund-basis financial statements of Jefferson County have been completed for the year 2017 and appear in the first tab of the Excel spreadsheet provided with this exercise. The following information is also available: a Capital Assets Capital assets purchased in previous years through governmental-type funds totaled $7,890,000 (net of accumulated depreciation) as of January 1. Depreciation on capital assets used in governmental-type activities amounted to $316,000 No capital assets were sold or disposed of and all purchases are properly reflected in the fund-basis statements as capital expenditures. b. Long-Term Debt There was no outstanding long-term debt associated with governmental-type funds as of January 1. April 1, 6 percent bonds with a face value of $700,000 were issued at a premium. Bond payments are made on October 1 and April 1 of each year. Interest is based on an annual rate of 6 percent, and principal payments are $22,000 each. The first payment (interest and principal) was made on October 1. Amortization of the bond premium for the current year is $1,800 c. Deferred Inflows of Resources Deferred inflows (comprised solely of property taxes) are expected to be collected more than 60 days after year-end. The balance of deferred taxes at the end of 2016 was $19,500. d. Transfers Page 257 Transfers were between governmental-type funds. E. Internal Service Fund The (motor pool) internal service fund's revenue is predominantly derived from departments classified as governmental-type activities There were no amounts due to the internal service fund from the General Fund. The outstanding balance of Due to Other Funds was with the enterprise fund and is not capital related. The enterprise fund provided a long-term advance to the internal service fund (not capital related). Required: Use the Excel template provided to complete the following requirements; a separate tab is provided in Excel for each of these steps 1. Prepare the journal entries necessary to convert the governmental fund financial statements to the accrual basis of accounting. 2. Post the journal entries to the conversion worksheet provided 3. Prepare a government-wide Statement of Activities and Statement of Net Position for the year 2017. All of the governmental fund revenues are "general revenues. This is an involved problem, requiring many steps. Here are some hints. a. Tab 1 is information to be used in the problem. You do not enter anything here. b. After you make the journal entries (Tab 2), post these to the worksheet to convert to the accrual basis. This worksheet is set up so that you enter debits as positive numbers and credits as negative. After you post your entries, look at the numbers below the total credit column to see that debits equal credits. If not, you probably entered a credit as a positive number c. Make sure that total debits equal total credits in the last column (balances for government-wide statements) d. When calculating Restricted Net Position, recall that permanent fund principal is added to restricted fund balances. 8-14 The fund-basis financial statements of the City of Cottonwood have been completed for the year 2017 and appear in the first tab of the Excel spreadsheet provided with this exercise. In addition, the government-wide Statement of Net Position from the previous fiscal year is provided and should be used to determine beginning balances for accounts not appearing in the fund basis statements. The following information is also available: a Capital Assets Capital assets purchased by governmental funds are charged to capital expenditure and do not appear as assets in the fund-basis balance sheet. However, the balance is reflected in the Statement of Net Position in the government-wide financial statements Depreciation on capital assets used in governmental-type activities amounted to $3,100,000 for the year Page 258 No capital assets were sold or disposed of and all purchases are properly reflected in the fund-basis statements as capital expenditures. b. Long-Term Debt Proceeds from bonds issued by governmental funds are reflected in other financing sources and do not appear as liabilities in the fund-basis balance sheet. Payments of principal are recognized as expenditures when due. The balance of outstanding bonds balance is reflected in the Statement of Net Position in the government-wide financial statements. Interest is recognized in the fund-basis statements only when payment is due. Interest accrued but not yet payable amounted to $167,000 at December 31, 2017. Interest accrued for purposes of the government-wide statements in 2016 has been paid and is reflected in interest expenditure in 2017. There are no bond discounts or premiums. c. Deferred Inflows of Resources Deferred inflows are comprised solely of property taxes expected to be collected more than 60 days after year-end The balance of deferred taxes at the end of 2016 was $188,400 and was recognized as revenue in the fund-basis statements in 2017 d. The City accounts for its solid waste landfill in the General Fund (public works department). The estimated liability for closure and postclosure care costs as of December 31, 2017, is $2,600,000 and appears only in the government-wide statements e. Transfers During the year, the General Fund transferred cash to the courthouse renovation, debt service, and enterprise funds f The City does not operate any internal service funds. 3. When entering amounts in the Statement of Activities, Charges for Services Revenue in the governmental funds is attributable to the following functions: General Government $1,156,497 44,018 Judicial Administration Public Safety 275,492 604,359 Parks and Recreation Community Development 51,611 $2,131.977 Total