Chapter 2 Opening the Books

The City of Smithville just implemented a dual-track computerized accounting system, which provides files for general journal entries and posting to appropriate general ledger/subsidiary ledger accounts. Budgetary, operating statement, and balance sheet accounts are provided for the General Fund and the other governmental fund types. Operating statement accounts and balance sheet accounts are also provided for governmental activities at the government-wide level and the proprietary and fiduciary funds of the City of Smithville that you will use in Chapters 5-9 of the problem. As the citys new accountant, it is your job to enter the citys initial accounting information as of December 31, 2019, in preparation for placing the new accounting system in full operation effective January 1, 2020.

Required

First, be sure to read the "Help" page to understand the general instructions on how to navigate and use this application.

If creating a new project, click "Create New Project," when the "Create New Project" window appears choose "Smithville" icon. In addition, in the "Your name" field, type your first and last name so that it will appear on all printable reports, and then click [Create] button. This will create the project and provide access to all of the funds and accounts that you will need to complete the Full Version City of Smithville cumulative problem.

To protect yourself from possible hard drive failure or corruption of your project data file, we recommended that you save your file to not only your hard drive but also another location (e.g., flash drive or the cloud), creating a backup file for your project at the end of each session.

To open an existing project, click on "Open Project" in the opening window or select the project from the "Recent projects" list.

1. If it is not already displayed, select [General Fund] in the "Current accounting entity" window and the [Accounts] tab. Clicking on the [Accounts] tab allows you to see the chart of accounts that will be used for the [General Fund]. A different chart of accounts is provided for each of the accounting entities. Next, select the [Journal] tab and click the [Add new entry] button and then click on[Select account or search by account name or number] in the Account column. You will see the same general ledger accounts that were listed when you clicked on the [Accounts] tab. (Note: For purposes of this exercise, date suffixes are omitted from the Expenditures and Encumbrances accounts as expenditures occur only from a single years appropriations.) You will not use all of the accounts listed for this project.

2. The trial balance for the General Fund of the City of Smithville as of December 31, 2019, follows. Select the [Journal] tab and create a journal entry to enter the balance sheet accounts and amounts shown in the trial balance. To create an entry start by clicking on [Add new entry]. Select or type the desired account name from the drop down list in the [Account] column. Be sure to enter 2019 from the dropdown in the [Year] column and enter the paragraph number from these instructions in the [Add description] field in the [Description] column of the [Journal]. For this entry you should enter 2-b. Select the appropriate accounts individually and insert the appropriate amounts. (Note: You should enter all dollar amounts without dollar signs, commas, and decimal points. For all entries, it is vitally important that the correct year be selected.)

   You enter each account and amount one line at a time by clicking [Add]. The [Add] button will not be active if information for the entry is missing (e.g., the transaction description is missing).

   The year and transaction description need only be entered for the first line of the journal entry; it will remain selected for the rest of the accounts. When you have completed entering all account data and amounts, verify your entries, including date and paragraph numbers. When you are sure that your entries are correct, click [Post entries] to post the items to the general ledger of the General Fund.

   CITY OF SMITHVILLE General Fund Post-Closing Trial Balance As of December 31, 2019

   Account Title	Debits	Credits
   Cash	$376,290
   Taxes ReceivableDelinquent	391,756
   Allowance for Uncollectible Delinquent Taxes		$11,752
   Interest and Penalties Receivable on Taxes	40,126
   Allowance for Uncollectible Interest and Penalties		3,611
   Due from Other Funds	12,000
   Due from State Government	165,000
   Inventory of Supplies	66,000
   Vouchers Payable		272,187
   Due to Other Funds		6,400
   Due to Federal Government		135,720
   Due to State Government		32,600
   Deferred Inflows of Resources		97,704
   Fund BalanceNonspendableInventory of Supplies		66,000
   Fund BalanceRestrictedPublic Safety		15,000
   Fund BalanceCommittedPublic Works		29,700
   Fund BalanceAssignedCulture and Recreation		56,800
   Fund BalanceUnassigned		323,698
   Totals	$1,051,172	$1,051,172

   Unpost capability. As mentioned in the "Help" page, the City of Smithville software program permits students to "unpost" a particular batch of posted transactions. Unposted entries then can be edited and re-posted. In addition, any omitted entries can be inserted above or below a selected journal line in any unposted batch of entries. Prior to unposting a batch, all batches must be posted.

   Select [Reports>Trial Balances>Post-Closing Trial Balance] and print or save as a .pdf file the post-closing trial balance for year 2019. Retain the printed trial balance in your personal cumulative folder until the due date assigned by your instructor for the project, or submit a saved version of the trial balance electronically if directed to do so by your instructor.

3. Select [Governmental Activities, Government-wide Level] in the "Current accounting entity" dropdown field and the [Accounts] tab. You will see most of the accounts included in the preceding trial balance, plus many other accounts that will be used in the various chapters of the City of Smithville project.

4. Select the [Journal] tab and create a journal entry to enter the statement of net position (i.e., balance sheet) accounts and amounts shown in the following trial balance. It is necessary to enter these items in the accounts of the governmental activities category at the government-wide level as the general journal and general ledger for governmental activities comprise a separate "set of books" from those for the General Fund. Be sure to enter 2019 from the dropdown menu in the [Year] column and enter 2-d in the [Add description] field in the [Description] column. Select each account individually and insert the appropriate debit or credit amount for each account. When you have completed entering the initial data, verify the accuracy and click [Post entries] to post the entry to the governmental activities, government-wide general ledger.

   CITY OF SMITHVILLE Governmental Activities Government-wide Level Post-Closing Trial Balance As of December 31, 2019

   Account Title	Debits	Credits
   Cash	$376,290
   Taxes ReceivableDelinquent	391,756
   Allowance for Uncollectible Delinquent Taxes		$11,752
   Interest and Penalties Receivable on Taxes	40,126
   Allowance for Uncollectible Interest and Penalties		3,611
   Due from State Government	165,000
   Internal Receivables from Business-type Activities	12,000
   Inventory of Supplies	66,000
   Land	4,180,000
   Infrastructure	9,862,000
   Accumulated DepreciationInfrastructure		2,713,944
   Buildings	6,296,000
   Accumulated DepreciationBuildings		1,731,000
   Equipment	3,556,800
   Accumulated DepreciationEquipment		1,765,480
   Vouchers Payable		272,187
   Due to Federal Government		135,720
   Due to State Government		32,600
   Internal Payables to Business-type Activities		6,400
   Net PositionNet Investment in Capital Assets		17,684,376
   Net PositionRestricted for Public Safety		15,000
   Net PositionUnrestricted		573,902
   Totals	$24,945,972	$24,945,972

5. Select [Reports>Trial Balances>Post-Closing Trial Balance] and print the trial balance for 2019, or submit a saved .pdf version of the trial balance electronically if directed to do so by your instructor. Retain in your cumulative file until the due date for your project or the time specified by your instructor.