Fund financial statements: The City of Manchester, New Hampshire, has only one activity, its school system. The school system is accounted for within the general fund. For convenience, assume that at the start of $204,$ the school

system and the city have no assets. During the year, the city assesses property taxes of $$400,000.$ Of this amount, it collects $$320,000$ during the year and $$50,000$ within a few weeks after the end of the

year and expects the remainder to be collected about six months later. The city makes the following payments during $20$X$4$: salary expense, $$100,000$; rent expense, $$70,000$; equipment $($received on

January $1$ with a five$-$year life and no salvage value$),$ $$50,000$; land, $$30,000$; and maintenance expense$),$ $$20,000.$

In addition, on the last day of the year, the city purchases a $$200,000$ building by signing a long$-$term note payable. The building has a $20-$year life and no salvage value, and the liability accrues interest at

a $0\%$ annual rate. The city also buys two computers on the last day of the year for $$4,000$ each. One will be paid for in $30$ days and the other in $90$ days. The computers should last four years and have no

expected residual value. During the year, the school system charges students $$3,000$ for school fees and collects the entire amount. The city determines depreciation using the straight line method.

$1$

Property Tax Receivable

Cash

Revenues$-$Property Taxes

Unavailable Revenues

The $$30,000$ is not viewed as revenue in $204$ because it will not be available within $60$ days after year$-$end to pay claims

against current financial resources. This balance is not a liability because there is no chance of repayment. Instead, it is a

deferred inflow of resources.

$2$

Expenditures$-$Salaries

Expenditures$-$Rent

Expenditures$-$Equipment

Expenditures$-$Land

Expenditures$-$Maintenance

Cash

$3$

No entry is made on the building acquisition because there was no impact on current financial resources.

$4$

Expenditures$-$Computer

Vouchers Payable

The second computer is not included here because payment will not be made within $60$ days of the end of the year, so

there is no effect on current financial resources.

$5$

Cash

Revenues$-$Student Fees