Question
E2-10 (Transaction AnalysisProprietary vs. Governmental Model) Analyze the following transactions, assuming that a business-type activity was involved. For any borrowing transactions, reflect any necessary year-end
E2-10 (Transaction AnalysisProprietary vs. Governmental Model)
Analyze the following transactions, assuming that a business-type activity was involved. For any borrowing transactions, reflect any necessary year-end interest accruals in your responses.
Analyze the following transactions, assuming that a general government activity was involved. For any borrowing transactions, reflect any necessary year-end interest accruals in your responses.
Salaries of $5,100 were incurred and paid during the year. Another $200 for salaries was incurred but not paid as of year end.
Charges for services rendered were billed (and received early the next fiscal year), $3,000.
Borrowed $2,000 on a 1-year, 10%, interest-bearing note, due 3 months after year end.
Principal ($2,000) and interest ($200) on the 1-year note were paid when due.
Received a $200 transfer from another fund.
Issued 10-year, 10% bonds payable for par of $1,000.
Annual interest on the bonds ($100) was paid when dueat year end.
Repaid the principal amount of a 5-year note, $800.
Purchased a computer with a 3-year useful life for cash, $900.
Straight-line depreciation of the computer is calculated to be $280 per year. The estimated residual value of the computer is $60.
The computer is sold at the end of its useful life for $35. Original cost was $900.
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