E10-20 Comparative Ratios [LO 10-4]

The government-wide financial statements for the City of Arborland for a three-year period are presented.

CITY OF ARBORLAND
Statements of Net Position
As of December 31
(in thousands)
	2017		2016		2015
	Governmental Activities		Business type Activities		Total		Governmental Activities		Business type Activities		Total		Governmental Activities		Business type Activities		Total
Assets
Current assets:
Cash	$	7,219			$	1,810			$	9,029			$	4,781			$	2,491			$	7,272			$	4,932			$	2,268			$	7,200
Investments		734				292				1,026				718				182				900				781				180				961
Receivables (net)		2,797				1,810				4,607				3,147				1,609				4,756				1,915				1,473				3,388
Prepaid expenses		254				9				263				351				7				358				172				6				178
Inventories		27				59				86				176				49				225				168				50				218
Total current assets		11,031				3,980				15,011				9,173				4,338				13,511				7,968				3,977				11,945
Capital assets:
Land		2,190				2,201				4,391				2,170				1,805				3,975				1,972				1,605				3,577
Depreciable assets		37,650				13,436				51,086				37,733				17,780				55,513				38,847				14,901				53,748
Accumulated depreciation		(15,539	)			(3,881	)			(19,420	)			(17,332	)			(10,026	)			(27,358	)			(19,880	)			(7,702	)			(27,582	)
Total capital assets (net)		24,301				11,756				36,057				22,571				9,559				32,130				20,939				8,804				29,743
Total assets		35,332				15,736				51,068				31,744				13,897				45,641				28,907				12,781				41,688
Liabilities
Accounts payable		1,630				517				2,147				469				377				846				1,663				300				1,963
Deferred revenue		33								33				120								120				55								55
Other, current		1,755				210				1,965				1,453				191				1,644				1,549				175				1,724
Total current liabilities		3,418				727				4,145				2,042				568				2,610				3,267				475				3,742
Bonds payable		16,000				6,700				22,700				17,000				7,510				24,510				16,400				6,600				23,000
Total liabilities		19,418				7,427				26,845				19,042				8,078				27,120				19,667				7,075				26,742
Net Position
Net investment in capital assets		10,232				2,859				13,091				8,489				3,491				11,980				5,497				2,268				7,765
Restricted for:
Capital projects		150				?				150				152				?				152				131				?				131
Debt service		934				?				934				1,034				?				1,034				819				?				819
Unrestricted (deficit)		4,598				5,450				10,048				3,027				2,328				5,355				2,793				3,438				6,231
Total net position	$	15,914			$	8,309			$	24,223			$	12,702			$	5,819			$	18,521			$	9,240			$	5,706			$	14,946

CITY OF ARBORLAND Statement of Activities For the Year Ended December 31, 2017 (in thousands)
		Program Revenues		Net (Expense) Revenue and Changes in Net Position
Functions/Programs	Expenses		Charges for Services		Operating Grants and Contributions		Capital Grants and Contributions		Governmental Activities		Business-type Activities		Total
Governmental Activities:
General government	$	5,718			$	541			$	?				?			$	(5,177	)			?			$	(5,177	)
Judicial		1,927				766				100				?				(1,061	)			?				(1,061	)
Public safety		7,959				1,580				218				?				(6,161	)			?				(6,161	)
Health and sanitation		2,809				534				?				?				(2,275	)			?				(2,275	)
Culture and recreation		2,216				555				?			$	545				(1,116	)			?				(1,116	)
Road maintenance		2,460				15				1,669				?				(776	)			?				(776	)
Interest on long-term debt		949				?				?				?				(949	)			?				(949	)
Total governmental activities		24,038				3,991				1,987				545				(17,515	)			?				(17,515	)
Business-type activities		2,945				5,418				?				17				?			$	2,490				2,490
Total government	$	26,983			$	9,409			$	1,987			$	562			$	(17,515	)		$	2,490			$	(15,025	)
	General Revenues:
	Property taxes		17,446								17,446
	Grants and contributions not restricted to specific programs		2,315								2,315
	Investment earnings		816								816
	Special item?gain on sale of land		150				?				150
	Total general revenues and special items		20,727								20,727
	Change in net position		3,212				2,490				5,702
	Net position?January 1		12,702				5,819				18,521
	Net position?December 31	$	15,914			$	8,309			$	24,223

CITY OF ARBORLAND Statement of Activities For the Year Ended December 31, 2016 (in thousands)
		Program Revenues		Net (Expense) Revenue and Changes in Net Position
Functions/Programs	Expenses		Charges for Services		Operating Grants and Contributions		Capital Grants and Contributions		Governmental Activities		Business-type Activities		Total
Governmental Activities:
General government	$	4,138			$	149				?				?			$	(3,989	)			?			$	(3,989	)
Judicial		1,738				210			$	47				?				(1,481	)			?				(1,481	)
Public safety		5,240				1,944				50				?				(3,246	)			?				(3,246	)
Health and sanitation		2,149				148				?				?				(2,001	)			?				(2,001	)
Culture and recreation		3,862				324				?			$	351				(3,187	)			?				(3,187	)
Road maintenance		1,105				?				526				?				(579	)			?				(579	)
Interest on long-term debt		879				?				?				?				(879	)			?				(879	)
Total governmental activities		19,111				2,775				623				351				(15,362	)			?				(15,362	)
Business-type activities		4,288				4,390				?				11				?			$	113				113
Total government	$	23,399			$	7,165			$	623			$	362			$	(15,362	)		$	113			$	(15,249	)
	General Revenues:
	Property taxes		13,819								13,819
	Grants and contributions not restricted to specific programs		3,739								3,739
	Investment earnings		966								966
	Special item?gain on sale of land		300				?				300
	Total general revenues and special items		18,824				?				18,824
	Change in net position		3,462				113				3,575
	Net position?January 1		9,240				5,706				14,946
	Net position?December 31	$	12,702			$	5,819			$	18,521

CITY OF ARBORLAND Statement of Activities For the Year Ended December 31, 2015 (in thousands)
		Program Revenues		Net (Expense) Revenue and Changes in Net Position
Functions/Programs	Expenses		Charges for Services		Operating Grants and Contributions		Capital Grants and Contributions		Governmental Activities		Business-type Activities		Total
Governmental Activities:
General government	$	3,947			$	110			$	?				?			$	(3,837	)			?			$	(3,837	)
Judicial		1,681				200				58				?				(1,423	)			?				(1,423	)
Public safety		4,163				1,724				11				?				(2,428	)			?				(2,428	)
Health and sanitation		2,221				266				?				?				(1,955	)			?				(1,955	)
Culture and recreation		3,529				399				?			$	380				(2,750	)			?				(2,750	)
Road maintenance		1,473				?				462				?				(1,011	)			?				(1,011	)
Interest on long-term debt		998				?				?				?				(998	)			?				(998	)
Total governmental activities		18,012				2,699				531				380				(14,402	)			?				(14,402	)
Business-type activities		2,687				3,733				?				21				?			$	1,067				1,067
Total government	$	20,699			$	6,432			$	531			$	401			$	(14,402	)		$	1,067			$	(13,335	)
	General Revenues:
	Property taxes		13,200								13,200
	Grants and contributions not restricted to specific programs		3,000								3,000
	Investment earnings		696								696
	Special item?gain on sale of land		225				?				225
	Total general revenues and special items		17,121				?				17,121
	Change in net position		2,719				1,067				3,786
	Net position?January 1		6,521				4,639				11,160
	Net position?December 31	$	9,240			$	5,706			$	14,946

Additional information follows:

Population: Year 2017: 30,430, Year 2016: 28,301, Year 2015: 26,384. Debt limit remained at $20,050,000 for each of the three years. Net cash from operations is generally 80 percent of total revenues each year.

Required

a.	Select X for the financial performance measures inIllustration 10?4that can be calculated for the City of Arborland based on the information provided.

b.

Calculate those ratios identified in part a for FY 2017. Show your computations.(Round your answers to the nearest whole dollar amount. Enter your answer in thousands except for Bonded debt per Capita, Available Legal Debt Limit and Property Taxes per Capital whose values should be entered in dollars but not in thousands. Use ending values if the averages are not available. Use Property tax revenues instead of Property tax levy in your computation.)

E10-20 Comparative Ratios [LO 10-4]

The government-wide financial statements for the City of Arborland for a three-year period are presented.

CITY OF ARBORLAND

Statements of Net Position

As of December 31

(in thousands)

2017

2016

2015

Governmental Activities

Business type Activities

Total

Governmental Activities

Business type Activities

Total

Governmental Activities

Business type Activities

Total

The government-wide financial statements for the City of Arborland for a three-year period are presented. Governmental Activities Ass ets Cur rent asse ts: C ash In vest ment s R ecei vabl es (net) Pr epai d expe nses In vent ories T otal curr ent asse ts Ca pital asse ts: La nd D epre ciabl e asse ts A ccu mula ted depr eciat $ 7,21 9 2017 Business type Activities $ 1,81 0 Total $ 9,02 9 CITY OF ARBORLAND Statements of Net Position As of December 31 (in thousands) 2016 Business Governmental type Activities Activities $ 4,78 1 $ 2,49 1 Total $ 7,27 2 Governmental Activities $ 4,93 2 201 Busin typ Activ $ 2,2 734 292 1,02 6 718 182 900 781 18 2,79 7 1,81 0 4,60 7 3,14 7 1,60 9 4,75 6 1,91 5 1,4 254 9 263 351 7 358 172 27 59 86 176 49 225 168 5 11,0 31 3,98 0 15,0 11 9,17 3 4,33 8 13,5 11 7,96 8 3,9 2,19 0 2,20 1 4,39 1 2,17 0 1,80 5 3,97 5 1,97 2 1,6 37,6 50 13,4 36 51,0 86 37,7 33 17,7 80 55,5 13 38,8 47 14 0 (15,5) 39 (3,88) 1 (19,4) 20 (17,3) 32 (10,0) 26 (27,3) 58 (19,8) 80 (7,7 ion T otal capit al asse ts (net) Tot al asse ts Lia biliti es Acc ount s paya ble Def erre d reve nue Oth er, curr ent 24,3 01 11,7 56 36,0 57 22,5 71 35,3 32 15,7 36 51,0 68 31,7 44 1,63 0 517 2,14 7 469 33 120 33 9,55 9 13,8 97 377 20,9 39 8,8 45,6 41 28,9 07 12 8 846 1,66 3 30 120 55 32,1 30 1,75 5 210 1,96 5 1,45 3 191 1,64 4 1,54 9 17 To tal curr ent liabili ties Bo nds paya ble 3,41 8 727 4,14 5 2,04 2 568 2,61 0 3,26 7 47 16,0 00 6,70 0 22,7 00 17,0 00 7,51 0 24,5 10 16,4 00 6,6 Tot al liabili ties 19,4 18 7,42 7 26,8 45 19,0 42 8,07 8 27,1 20 19,6 67 7,0 10,2 32 2,85 9 13,0 91 8,48 9 3,49 1 11,9 80 5,49 7 2,2 Net Posit ion Net inve stme nt in capit al asse ts Re strict ed for: C apita l proje cts D ebt servi ce Unr estri cted (defi cit) Tot al net posit ion 150 150 152 152 131 934 934 1,03 4 1,03 4 819 4,59 8 5,45 0 10,0 48 3,02 7 2,32 8 5,35 5 2,79 3 3,4 $ 15,9 14 $ 8,30 9 $ 24,2 23 $ 12,7 02 $ 5,81 9 $ 18,5 21 $ 9,24 0 $ 5,7 CITY OF ARBORLAND Statement of Activities For the Year Ended December 31, 2017 (in thousands) Net (Expense) Revenue and Changes in Net Position Program Revenues Functi ons/Pr ogram s Gove rnment al Activiti es: Gene ral govern ment Judici al Publi c safety Healt h and sanitati on Cultur e and recreat ion Road mainte Expenses Charges for Services $ 5,718 $ 541 1,927 Operating Grants Capital Grants Governmental and Contributions and Contributions Activities $ Business-type Activities Total $ (5,17) 7 $ (5,17) 7 766 100 7,959 1,580 218 (1,06) 1 (6,16) 1 (1,06) 1 (6,16) 1 2,809 534 (2,27) 5 (2,27) 5 2,216 555 $ 545 (1,11) 6 (1,11) 6 2,460 15 1,669 (776) (776) nance Intere st on longterm debt 949 (949) (949) Total govern mental activiti es Busin esstype activiti es 24,03 8 3,991 1,987 545 (17,5) 15 (17,5) 15 2,945 5,418 17 Total govern ment $ 26,98 3 $ 9,409 $ 1,987 $ 562 General Revenues: Property taxes $ (17,5) 15 17,44 6 2,315 816 150 Grants and contributions not restricted to specific programs Investment earnings Special itemgain on sale of land Total general revenues and special items $ 2,490 2,490 $ 2,490 $ (15,0) 25 17,44 6 2,315 816 150 20,72 7 Change in net position Net positionJanuary 1 Net positionDecember 31 20,72 7 3,212 12,70 2 2,490 5,819 5,702 18,52 1 $ 15,91 4 $ 8,309 $ 24,22 3 CITY OF ARBORLAND Statement of Activities For the Year Ended December 31, 2016 (in thousands) Net (Expense) Revenue and Program Revenues Changes in Net Position Functi ons/Pr ogram s Gove rnment al Activiti es: Gene ral govern Expenses Charges for Services $ 4,138 $ 149 Operating Grants Capital Grants Governmental and Contributions and Contributions Activities $ (3,98) 9 Business-type Activities Total $ (3,98) 9 ment Judici al Publi c safety Healt h and sanitati on Cultur e and recreat ion Road mainte nance Intere st on longterm debt 1,738 210 5,240 $ 47 (1,48) 1 (3,24) 6 1,944 50 2,149 148 (2,00) 1 (2,00) 1 3,862 324 $ 351 (3,18) 7 (3,18) 7 1,105 526 (579) (579) 879 (879) (879) Total govern mental activiti es Busin esstype activiti es 19,11 1 2,775 623 351 (15,3) 62 (15,3) 62 4,288 4,390 11 Total govern ment $ 23,39 9 $ 7,165 $ 623 $ 362 General Revenues: Property taxes Grants and contributions not restricted to specific programs Investment earnings Special itemgain on sale of land Total general revenues and special items Change in net position Net positionJanuary 1 Net positionDecember 31 CITY OF ARBORLAND $ (15,3) 62 13,81 9 3,739 966 300 $ 113 $ 113 (1,48) 1 (3,24) 6 113 $ (15,2) 49 13,81 9 3,739 966 300 18,82 4 18,82 4 3,462 9,240 113 5,706 3,575 14,94 6 $ 12,70 2 $ 5,819 $ 18,52 1 Statement of Activities For the Year Ended December 31, 2015 (in thousands) Net (Expense) Revenue and Changes in Net Position Program Revenues Functi ons/Pr ogram s Gove rnment al Activiti es: Gene ral govern ment Judici al Publi c safety Healt h and sanitati on Cultur e and recreat ion Road mainte nance Intere st on longterm debt Expenses Charges for Services $ 3,947 $ 110 1,681 Operating Grants Capital Grants Governmental and Contributions and Contributions Activities $ Business-type Activities Total $ (3,83) 7 $ (3,83) 7 200 58 4,163 1,724 11 (1,42) 3 (2,42) 8 (1,42) 3 (2,42) 8 2,221 266 (1,95) 5 (1,95) 5 3,529 399 $ 380 (2,75) 0 (2,75) 0 1,473 462 (1,01) 1 (1,01) 1 998 (998) (998) Total govern mental activiti es Busin esstype activiti es 18,01 2 2,699 531 380 (14,4) 02 (14,4) 02 2,687 3,733 21 Total govern ment $ 20,69 9 $ 6,432 $ 531 $ 401 General Revenues: Property taxes Grants and contributions not restricted to specific programs Investment earnings $ (14,4) 02 13,20 0 3,000 696 $ 1,067 1,067 $ 1,067 $ (13,3) 35 13,20 0 3,000 696 Special itemgain on sale of land Total general revenues and special items Change in net position Net positionJanuary 1 Net positionDecember 31 225 225 17,12 1 17,12 1 2,719 6,521 1,067 4,639 3,786 11,16 0 $ 9,240 $ 5,706 $ 14,94 6 Additional information follows: Population: Year 2017: 30,430, Year 2016: 28,301, Year 2015: 26,384. Debt limit remained at $20,050,000 for each of the three years. Net cash from operations is generally 80 percent of total revenues each year. Required a. Select X for the financial performance measures in Illustration 10-4 that can be calculated for the City of Arborland based on the information provided. b. Calculate those ratios identified in part a for FY 2017. Show your computations. (Round your answers to the nearest whole dollar amount. Enter your answer in thousands except for Bonded debt per Capita, Available Legal Debt Limit and Property Taxes per Capital whose values should be entered in dollars but not in thousands. Use ending values if the averages are not available. Use Property tax revenues instead of Property tax levy in your computation.)