I have the answer to everything but part E.
Continuing Prob tional parts of this problem are at the end of Chapters 5 (covering General and Special Revenue Funds). pter 6 (covering Capital Projects and Debt Service Funds), Chapter 9 (covering preparation of fund finan- Chapter 6 statements), and Chapter 10 (covering the governmental activities part of the government-wide financial statements). Par rt A-Chapter 3-Scenario and General Fund budgetary journal entries The scenario Fund, a Capital Projects Fund, and a Debt Service Fund. thousands of dollars). Croton City maintains four govemmental-type funds: a General Fund, a Library Special Revenue Croton City started its calendar year 2019 with the following General Fund balances (all numbers are in DebitsCredits Cash Property taxes receivable.. $1,800 800 $ 700 300 1,600 $2,600 $2,600 Deferred property tax revenues . Unassigned fund balance. .. . .. .. Croton has adopted the following budgetary and accounting policies: Encumbrance accounting is used only for the acquisition of supplies and for the award of contracts for construction and construction-related activities. Open encumbrances lapse at the end of the year, but are considered in developing the next year's budget. Because final income tax returns are not required to be filed until April 15 of the year following the end of a calendar year, "available" for income taxes is defined as taxes expected to be collected within 120 after the end of the calendar year. Croton allows its employees to accumulate unused vacation days and to receive cash for up to 30 days of un- used vacation leave at retirement. Such payments are charged to the department's appropriation for salaries. . days . Chapter 3 Budgetary Considerations in Govemmental Accounting All revenues received by the library from fines, donations, and fundraising events are credited to Revenues-miscellaneous General Fund budgetary jounal entries: Prepare jourmal entries to record the following budgetary transactions ap- plicable to the General Fund. Also, prepare an appropriations ledger for the Public safety supplies appropriation. (Because you will need to prepare trial balances for each of the funds for Part D of this problem, it is suggested that you post the opening trial balance and the journal entries to general ledger T accounts.) I. The Croton council adopted the following General Fund budget for 2019: 5,000 1,000 600 Revenues-personal income taxes Re Appropriations: fees Public safety salaries Public safety supplies 7,000 500 Parks salaries Transfer to Library Fund Transfer to Debt Service Fund 2,300 100 2. Croton's Public Safety Department placed two purchase orders against its supplies appropriation, one for $300 for firearms and one for $150 for uniforms. The firearms were received, with an invoice for $330. The purchase order allowed shipment of 10 percent over the amount ordered, so the invoice was approved. 3. 4. The invoice for firearms was paid. 5. The Croton Cats won the World Series. To provide more funds for crowd control at the parade, the council increased the Public safety salaries appropriation by $100. 2. The Assigned fund balance at the beginning of the year represented outstanding encumbrances that lapsed at year end. The purchase orders that had been encumbered will be charged against 2020 appropriations. Continuing Part B (1)-Chapter S-Journal entries for General Fund financial transactions for Croton City Prepare jourmal entries, as appropriate, to record these transactions. (We suggest you post the journal entries to general ledger T-accounts.) Note: The Croton City continuing problem is introduced in Chapter 3 on page 3-32. ou should review the scenario in Chapter 3 before preparing the journal entries for the General Fund in this chapter 1. Of the $800 in property taxes receivable at January 1, $780 was collected in cash. The remaining $20 was written off as uncollectible. Deferred property taxes at the beginning of the year were recognized as revenue ($300). 2. Accrued salaries from the previous year ($700) were paid. 3. Property taxes in the amount of $9,030 were levied in order to provide revenues of $9,000. Tax bills were sent to the property owners. An allowance for uncollectible taxes was established. 4. During the year, property taxes of $8,100 were collected in cash. 5. The state collects personal income taxes on behalf of the city. During the year, Croton received personal income taxes of $4.600 from the state. 6. The Parks Department collected $700 in recreation fees during the year 7. Croton paid salaries of $13,600, charging the salary appropriations as follows: Public safety $6,700 Public works 4,700 Parks 2,200 5-53 Chapter 5 General and Special Revenue Funds (Continued) a special public safety program, stipulating that the $200 remains available rPaid in the ailable for spending on 8. The state sent the city a check for $1,000 to finance resources could be used at any time during 2019 or 2020. The $6,700 in public safety previous transaction includes $800 of salaries for this program, so $200 remains av the program in 2020. 9. Unpaid salaries at year-end (to be paid during the first week of 2020) were as follows: Public safety $350 Public works 250 Parks At year-end, the uncollected ible taxes is reclassified 100 property taxes were declared delinquent. The existing allowance for uncollect- to delinquent. Croton's director of finance estimated that $500 of the uncollected 10. 2020. taxes would be collected in January and February 2020 and $400 would be collected during the rest of 11. In January 2020, the state advised Croton that the state held $500 in personal income taxes on the city's behalf and that it would send the taxes to Croton by February 10. It also told Croton that it was likely that, by April 30, Croton would receive an additional $200 of taxes with final returns, but that tax refunds would probably be $300. (Remember that "available" for income taxes is defined as taxes expected to be collected within 120 days after the end of the calendar year.) Police officers who retired at the end of 2019 will be paid $10 for unused vacation pay on January 6, 2020. 12. Part B (2)-Chapter 5-Journal entries for Special Revenue Fund transactions The Library Special Revenue Fund commenced calendar year 2019 with a cash balance of $5, no liabilities, and a restricted fund balance of $5. Prepare journal entries to record these transactions in the Library Special Revenue Fund and, where appropriate, in the General Fund. (We suggest you post opening balances and the journal entries to general ledger T-accounts.) 1. The General Fund transferred $100 cash to the Library Special Revenue Fund to help the library finance its 2. The library received a grant of $300 from the county. The grant must be used only for library purposes, but 4. The library paid $350 for salaries and $40 to acquire books and periodicals. Charge the Expenditures-cul- activities for the year there is no requirement as to when it must be spent. 3. The library received $20 from fines, donations, and various fundraising events. ture salaries and Expenditures-culture supplies accounts, respectively. Continuing Part C(1)- Chapter 6- Journal entries for Capital Projects Fund transactions the start of 2019, Croton's Capital Projects Fund had no assets or liabilities. Prepare appropriate journal en- tres to record these transactions in the Capital Projects Fund. (We suggest you post the journal entries to general I. Croton undertook construction of a new police station, designed to house both the Croton police and the $1,000 from the county as an advance pending incurrence of expenditures. It also sold $2,.000 of 20-year ledger T-accounts.) county sheriff and to serve as a detention center. To finance construction, Croton received a cash grant of general obligation bonds. The bonds, sold April 1, 2019, were to be redeemed in equal semiannual install- ments of principal, with interest on the unpaid balance at the rate of 5 percent per annum, starting October 1, 2019. 2. Croton awarded two contracts, one for architectural and construction supervision services ($200) and one for construction ($2,800). 3. The construction contract was completed in a timely manner, and the contractor submitted an invoice for $2,800. The invoice was paid, except that 5 percent was withheld, pending completion of inspection. 4. All construction and construction supervision work was completed. The construction architect/supervisor was paid in full, and the contractor was paid the balance due. Part C (2) Chapter 6-Journal entries for Debt Service Fund transactions At the start of 2019, Croton's Debt Service Fund had no assets or liabilities. Prepare appropriate journal entries to record these transactions in the Debt Service Fund and where appropriate, in the General Fund. (We suggest you post opening balances and the journal entries to general ledger T-accounts.) 1. The General Fund transferred $1,200 cash to the Debt Service Fund. 2. The first installment of principal and interest on the bonds sold in Part C (1) came due for payment. 3. The principal and interest due for payment were paid. 4. Debt service on bonds sold by Croton in previous years came due and was paid. Principal and interest pay- ments on those bonds were $600 and $470, respectively Continuing Proble Part E Chapter 10- Preparation of jounal entries for govenment- wide financial statements and preparaticn of government-wide financial statements The following additional information is furnished to complete this part of the problem. 1. Croton has no activities other than governmental activities. The city's government-wide statement of net position for the year ended December 31,2018, showed general capital assets of $14,000 and related ac- cumulated depreciation of $6,400. 2 Depreciation expense on Croton's general capital assets for 2019 (including assets acquired in 2019) was $700, all of which was applicable to public safety 3. The city's government-wide statement of net position for the year ended December 31, 2018, showed bonds payable of $5,500. All the debt had been issued to finance capital assets. Analysis of Croton's debt service requirements showed that $700 of the total bonds payable as of December 31, 2019, should be reported as current because it is due to be paid during 2020. 4. The city's govemment-wide statement of net position for the year ended December 31, 2018, showed ac- crued interest payable of $120 on its outstanding long-term debt. Analysis of the city's debt service require- ments showed accrued interest payable of $135 on all outstanding long-term debt as of December 31, 2019, including the debt sold by the city during 2019. 5. Croton's government-wide statement of net position for the year ended December 31, 2018, showed accrued vacation pay of $75. Vacation leave records showed that, as of December 31, 2019, accumulated vacation leave had increased to $87, exclusive of the $10 due to be paid to retired police officers early in 2020. (As sume vacation leave applies only to the public safety function.) Use the preceding information to do the following: a. Prepare journal entries needed to convert the governmental funds financial statements to the governmental activities columns of the government-wide financial statements. Review and make adjustments for journal entries made in Chapter 5 and Chapter 6 portions of this problem for revenues-property taxes; deferred property tax revenue; other financing sources-long-term debt issued; expenditures-capital outlay expendituresbond principal; and transfers in and out. Then, record journal entries for 1 through 5 above. Post the journal entries to a six-column worksheet similar to that shown in Table 10-8. b. Prepare Croton City's government-wide financial statements-a statement of net position and a statement of c. Prepare Croton's financial statement reconciliations-the funds balance sheet to the government-wide activities. statement of net position and the funds statement of revenues, expenditures, and changes in fund balances to the government-wide statement of activities. Continuing Prob tional parts of this problem are at the end of Chapters 5 (covering General and Special Revenue Funds). pter 6 (covering Capital Projects and Debt Service Funds), Chapter 9 (covering preparation of fund finan- Chapter 6 statements), and Chapter 10 (covering the governmental activities part of the government-wide financial statements). Par rt A-Chapter 3-Scenario and General Fund budgetary journal entries The scenario Fund, a Capital Projects Fund, and a Debt Service Fund. thousands of dollars). Croton City maintains four govemmental-type funds: a General Fund, a Library Special Revenue Croton City started its calendar year 2019 with the following General Fund balances (all numbers are in DebitsCredits Cash Property taxes receivable.. $1,800 800 $ 700 300 1,600 $2,600 $2,600 Deferred property tax revenues . Unassigned fund balance. .. . .. .. Croton has adopted the following budgetary and accounting policies: Encumbrance accounting is used only for the acquisition of supplies and for the award of contracts for construction and construction-related activities. Open encumbrances lapse at the end of the year, but are considered in developing the next year's budget. Because final income tax returns are not required to be filed until April 15 of the year following the end of a calendar year, "available" for income taxes is defined as taxes expected to be collected within 120 after the end of the calendar year. Croton allows its employees to accumulate unused vacation days and to receive cash for up to 30 days of un- used vacation leave at retirement. Such payments are charged to the department's appropriation for salaries. . days . Chapter 3 Budgetary Considerations in Govemmental Accounting All revenues received by the library from fines, donations, and fundraising events are credited to Revenues-miscellaneous General Fund budgetary jounal entries: Prepare jourmal entries to record the following budgetary transactions ap- plicable to the General Fund. Also, prepare an appropriations ledger for the Public safety supplies appropriation. (Because you will need to prepare trial balances for each of the funds for Part D of this problem, it is suggested that you post the opening trial balance and the journal entries to general ledger T accounts.) I. The Croton council adopted the following General Fund budget for 2019: 5,000 1,000 600 Revenues-personal income taxes Re Appropriations: fees Public safety salaries Public safety supplies 7,000 500 Parks salaries Transfer to Library Fund Transfer to Debt Service Fund 2,300 100 2. Croton's Public Safety Department placed two purchase orders against its supplies appropriation, one for $300 for firearms and one for $150 for uniforms. The firearms were received, with an invoice for $330. The purchase order allowed shipment of 10 percent over the amount ordered, so the invoice was approved. 3. 4. The invoice for firearms was paid. 5. The Croton Cats won the World Series. To provide more funds for crowd control at the parade, the council increased the Public safety salaries appropriation by $100. 2. The Assigned fund balance at the beginning of the year represented outstanding encumbrances that lapsed at year end. The purchase orders that had been encumbered will be charged against 2020 appropriations. Continuing Part B (1)-Chapter S-Journal entries for General Fund financial transactions for Croton City Prepare jourmal entries, as appropriate, to record these transactions. (We suggest you post the journal entries to general ledger T-accounts.) Note: The Croton City continuing problem is introduced in Chapter 3 on page 3-32. ou should review the scenario in Chapter 3 before preparing the journal entries for the General Fund in this chapter 1. Of the $800 in property taxes receivable at January 1, $780 was collected in cash. The remaining $20 was written off as uncollectible. Deferred property taxes at the beginning of the year were recognized as revenue ($300). 2. Accrued salaries from the previous year ($700) were paid. 3. Property taxes in the amount of $9,030 were levied in order to provide revenues of $9,000. Tax bills were sent to the property owners. An allowance for uncollectible taxes was established. 4. During the year, property taxes of $8,100 were collected in cash. 5. The state collects personal income taxes on behalf of the city. During the year, Croton received personal income taxes of $4.600 from the state. 6. The Parks Department collected $700 in recreation fees during the year 7. Croton paid salaries of $13,600, charging the salary appropriations as follows: Public safety $6,700 Public works 4,700 Parks 2,200 5-53 Chapter 5 General and Special Revenue Funds (Continued) a special public safety program, stipulating that the $200 remains available rPaid in the ailable for spending on 8. The state sent the city a check for $1,000 to finance resources could be used at any time during 2019 or 2020. The $6,700 in public safety previous transaction includes $800 of salaries for this program, so $200 remains av the program in 2020. 9. Unpaid salaries at year-end (to be paid during the first week of 2020) were as follows: Public safety $350 Public works 250 Parks At year-end, the uncollected ible taxes is reclassified 100 property taxes were declared delinquent. The existing allowance for uncollect- to delinquent. Croton's director of finance estimated that $500 of the uncollected 10. 2020. taxes would be collected in January and February 2020 and $400 would be collected during the rest of 11. In January 2020, the state advised Croton that the state held $500 in personal income taxes on the city's behalf and that it would send the taxes to Croton by February 10. It also told Croton that it was likely that, by April 30, Croton would receive an additional $200 of taxes with final returns, but that tax refunds would probably be $300. (Remember that "available" for income taxes is defined as taxes expected to be collected within 120 days after the end of the calendar year.) Police officers who retired at the end of 2019 will be paid $10 for unused vacation pay on January 6, 2020. 12. Part B (2)-Chapter 5-Journal entries for Special Revenue Fund transactions The Library Special Revenue Fund commenced calendar year 2019 with a cash balance of $5, no liabilities, and a restricted fund balance of $5. Prepare journal entries to record these transactions in the Library Special Revenue Fund and, where appropriate, in the General Fund. (We suggest you post opening balances and the journal entries to general ledger T-accounts.) 1. The General Fund transferred $100 cash to the Library Special Revenue Fund to help the library finance its 2. The library received a grant of $300 from the county. The grant must be used only for library purposes, but 4. The library paid $350 for salaries and $40 to acquire books and periodicals. Charge the Expenditures-cul- activities for the year there is no requirement as to when it must be spent. 3. The library received $20 from fines, donations, and various fundraising events. ture salaries and Expenditures-culture supplies accounts, respectively. Continuing Part C(1)- Chapter 6- Journal entries for Capital Projects Fund transactions the start of 2019, Croton's Capital Projects Fund had no assets or liabilities. Prepare appropriate journal en- tres to record these transactions in the Capital Projects Fund. (We suggest you post the journal entries to general I. Croton undertook construction of a new police station, designed to house both the Croton police and the $1,000 from the county as an advance pending incurrence of expenditures. It also sold $2,.000 of 20-year ledger T-accounts.) county sheriff and to serve as a detention center. To finance construction, Croton received a cash grant of general obligation bonds. The bonds, sold April 1, 2019, were to be redeemed in equal semiannual install- ments of principal, with interest on the unpaid balance at the rate of 5 percent per annum, starting October 1, 2019. 2. Croton awarded two contracts, one for architectural and construction supervision services ($200) and one for construction ($2,800). 3. The construction contract was completed in a timely manner, and the contractor submitted an invoice for $2,800. The invoice was paid, except that 5 percent was withheld, pending completion of inspection. 4. All construction and construction supervision work was completed. The construction architect/supervisor was paid in full, and the contractor was paid the balance due. Part C (2) Chapter 6-Journal entries for Debt Service Fund transactions At the start of 2019, Croton's Debt Service Fund had no assets or liabilities. Prepare appropriate journal entries to record these transactions in the Debt Service Fund and where appropriate, in the General Fund. (We suggest you post opening balances and the journal entries to general ledger T-accounts.) 1. The General Fund transferred $1,200 cash to the Debt Service Fund. 2. The first installment of principal and interest on the bonds sold in Part C (1) came due for payment. 3. The principal and interest due for payment were paid. 4. Debt service on bonds sold by Croton in previous years came due and was paid. Principal and interest pay- ments on those bonds were $600 and $470, respectively Continuing Proble Part E Chapter 10- Preparation of jounal entries for govenment- wide financial statements and preparaticn of government-wide financial statements The following additional information is furnished to complete this part of the problem. 1. Croton has no activities other than governmental activities. The city's government-wide statement of net position for the year ended December 31,2018, showed general capital assets of $14,000 and related ac- cumulated depreciation of $6,400. 2 Depreciation expense on Croton's general capital assets for 2019 (including assets acquired in 2019) was $700, all of which was applicable to public safety 3. The city's government-wide statement of net position for the year ended December 31, 2018, showed bonds payable of $5,500. All the debt had been issued to finance capital assets. Analysis of Croton's debt service requirements showed that $700 of the total bonds payable as of December 31, 2019, should be reported as current because it is due to be paid during 2020. 4. The city's govemment-wide statement of net position for the year ended December 31, 2018, showed ac- crued interest payable of $120 on its outstanding long-term debt. Analysis of the city's debt service require- ments showed accrued interest payable of $135 on all outstanding long-term debt as of December 31, 2019, including the debt sold by the city during 2019. 5. Croton's government-wide statement of net position for the year ended December 31, 2018, showed accrued vacation pay of $75. Vacation leave records showed that, as of December 31, 2019, accumulated vacation leave had increased to $87, exclusive of the $10 due to be paid to retired police officers early in 2020. (As sume vacation leave applies only to the public safety function.) Use the preceding information to do the following: a. Prepare journal entries needed to convert the governmental funds financial statements to the governmental activities columns of the government-wide financial statements. Review and make adjustments for journal entries made in Chapter 5 and Chapter 6 portions of this problem for revenues-property taxes; deferred property tax revenue; other financing sources-long-term debt issued; expenditures-capital outlay expendituresbond principal; and transfers in and out. Then, record journal entries for 1 through 5 above. Post the journal entries to a six-column worksheet similar to that shown in Table 10-8. b. Prepare Croton City's government-wide financial statements-a statement of net position and a statement of c. Prepare Croton's financial statement reconciliations-the funds balance sheet to the government-wide activities. statement of net position and the funds statement of revenues, expenditures, and changes in fund balances to the government-wide statement of activities
