Prepare summary entries to record h. The encumbrance of the goods and services c. The receipt of the goods and services. All invoices were paid in cash d. The actual revenues (all cash receipts) Prepare summary entries to close the accounts h reserve for encumbrance balance inspective of how classified? 4. Prepare a schedule in which you compare budected to actual revenues and expenditures substantial favorable variance between budgeted and actual expenditures and questions why the A citiren reviews the budget to actual schedule that you have prepared. She comments on the government did not spend the full amount of money that it appropriated. Briefly explain to her A city's note to its financial statements provides considerable insight into its budger practices. Shown below is an excerpt from a note headed Budgets, from the Smith City, annual report for the services that were ordered and appropriations lapse at year-end 1. a. The budget 2. What would be the vear-end a fund balance unassigned 5. nature of the variance 3.9 fiscal year ended June 30. 1. he 2. The note distinguishes between the "budget ordinance" and the "more detailed line-item budgets." Provide examples of expenditures that you would expect to see in the budget ordinance. h. Provide examples of expenditures that you would expect to see in the line-item budgets. Why do you suspect that budgetary control is not exercised in trust and custodial funds? 3. Generally accepted accounting principles require that governments reconcile differences between the entity's budget practices and GAAP either in the financial statements themselves or in accompanying notes. Smith City's budget-to-actual comparison contained no such reconciliation. Why do you think reconciliation was also omitted from the notes? 4. Explain how Smith City's appropriation process for its general fund would differ from that for its capital projects fund. How would this difference most likely affect the city's budgetary entries? The schedule included in the notes shows the original budget, total amendments, and the final budget. Where would a reader look to compare actual general fund expenditures with budgeted expenditures! Note from Smith City Annual Report 5. Budgetary control is exercised in all funds except for the trust and custodial funds. The budget shown in the financial statements is the budget ordinance as amended at the close of the day of June 30. The city is required by the General Statutes of the state to adopt an annual balanced budget by July 1 of each year. The General Statutes also provide for balanced project ordinances for the life of projects, including both Capital and grant activities, that are expected to extend beyond the end of the fiscal year. The city council Officially adopts the annual budget ordinance and all project ordinances and has the authority to amend such Problems 139 ordinances as necessary to recognize new resources or reallocations of budget. As of June 30, the effect of data, some goods or ations require that all Total Amendments General fund Special revenue funds General capital projects funds Proprietary funds Internal service funds Original Budget $145.259.996 49,087.784 135,304.688 145.984.461 845,657 $2.965,856 5.034.632 4,038,509 2,557,523 16,640 Budget June 30 $148.225.852 54,122.416 139,343,197 148,541,984 862,297 nathan ares. ents on the rather estions why the