Chapter 11 Problem 11-3

P 11-3 Discrete Discrete presentation, unlike blending, may combine two or more entities into a single colun revenue fund. The Hawkins Township has two component units that it is required to include in its reporting entity second, a transportation authority, has but one fund: an enterprise fund. The township itself has only a general fund. The first, a housing authority, maintains two funds: a general fund and a special condensed form, of all three entities are shown here (in millions). as appropriate, are capital assets and long-term obligations that are not recognized on the The fund balance sheets, in highly Also presented, fund statements because the statements are on a modified accrual basis. Hawkins Township Capital Assets and Long-Term Obligations General Fund $800 Cash and investments Capital assets Less: accumulated depreciation Net capital assets Total assets Long-term obligations $140 (40) $100 $100 S 30 $800 $800 $800 Fund balance S 30 Total long-term obligations and fund balances Transportation Authorly Cash and investments Capital assets Less: accumulated depreciation Net capital assets Total assets $ 50 800 200 600 $650 $200 $450 Long-term obligations Fund balance Total long-term obligations and fund balance $650 Housing Authority Capital Assets and Long-Term Obligations Special Revenue Fund S5 General Fund $10 Cash and investments Capital assets Less: accumulated depreciation Net capital assets $45 20 $25 $25 S 5 S5 S5 $5 S10 S10 S10 Total assets Long-term obligations Fund balance Total long-term obligations and S 5 fund balance Assume that both component units qualify for discrete presentation. On its government-wide state- ments, the township elects to combine the two units into a single column a. Prepare a government-wide statement of net assets (oc a full accrual basis) that presents both the 1. township and its component units. b. Comment on the significance of the column in whiel the two component units are presented. Suppose instead that the town is required to blend the two component units. a. Prepare a government-wide statement of net assets. Be sure to show the transportation authority as 2. a business-type activity b. If the township were to prepare fund statements, how would it report the housing authority's special revenue fund? How would it report its general fund