A successful businessman in the community has contacted the Moose County Board of Commissioners about donating income producing securities to the County to support a particular activity Under the agreement, the County would be required to maintain the principal amount of the gift but could use the resulting earnings The following events occurred in 2020 Securities, which had an original cost of $4,250,000 were donated to the County on January 1 The fair value of the securities at that date was $5,839,000, including Corporate equities of $2,825,000 Corporate bonds of $3,000,000 Accrued interest receivable on the bonds of $14,000 During the year, the fund received $180,000 in interest payments on the bonds At the end of the year, accrued interest on the bonds totaled $16,500 Page 211During the year, the fund received dividends on the corporate equities of $98,000 During the year, the fund paid $230,000 supporting activities identified in the trust agreement and had outstanding bills to be paid of $6,000 The fair value of the securities at December 31 was Corporate equities of $2,785,000 Corporate bonds of $3,060,000 Required You are to prepare financial statements for the fund In Part 1, the activities supported by the fund benefit the citizenry in general In Part 2, the activities benefit only selected individuals Part 1 Assume it is appropriate to report the gift and related transactions in a permanent fund following modified accrual basis statements Using the Excel template provided Prepare journal entries recording the events above Post the journal entries to T accounts Prepare closing entries Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance and a Balance Sheet (assume spendable net resources are to be classified as restricted for other purposes ) Part 2 Assume it is appropriate to report the gift and related transactions in a private purpose trust fund following the accrual basis Using the Excel template provided Prepare journal entries recording the events above Post the journal entries to T accounts Prepare closing entries Prepare a Statement of Changes in Fiduciary Net Position and a Statement of Fiduciary Net Position

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 18, 2024

A successful businessman in the community has contacted the Moose County Board of Commissioners about donating income-producing securities to the County to support a particular

A successful businessman in the community has contacted the Moose County Board of Commissioners about donating income-producing securities to the County to support a particular activity. Under the agreement, the County would be required to maintain the principal amount of the gift but could use the resulting earnings. The following events occurred in 2020:

Securities, which had an original cost of $4,250,000 were donated to the County on January 1. The fair value of the securities at that date was $5,839,000, including
- Corporate equities of $2,825,000.
- Corporate bonds of $3,000,000.
- Accrued interest receivable on the bonds of $14,000.
During the year, the fund received $180,000 in interest payments on the bonds. At the end of the year, accrued interest on the bonds totaled $16,500.
Page 211During the year, the fund received dividends on the corporate equities of $98,000.
During the year, the fund paid $230,000 supporting activities identified in the trust agreement and had outstanding bills to be paid of $6,000.
The fair value of the securities at December 31 was
- Corporate equities of $2,785,000.
- Corporate bonds of $3,060,000.
Required:

You are to prepare financial statements for the fund. In Part 1, the activities supported by the fund benefit the citizenry in general. In Part 2, the activities benefit only selected individuals.

Part 1: Assume it is appropriate to report the gift and related transactions in a permanent fund following modified accrual basis statements. Using the Excel template provided
1. Prepare journal entries recording the events above.
2. Post the journal entries to T-accounts.
3. Prepare closing entries.
4. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance and a Balance Sheet (assume spendable net resources are to be classified as restricted for other purposes).
Part 2: Assume it is appropriate to report the gift and related transactions in a private-purpose trust fund following the accrual basis. Using the Excel template provided
1. Prepare journal entries recording the events above.
2. Post the journal entries to T-accounts.
3. Prepare closing entries.
4. Prepare a Statement of Changes in Fiduciary Net Position and a Statement of Fiduciary Net Position.