Presented below are the computed amounts of ratios for the Village of Riverside example appearing in the chapter.

Required: a. Using the financial statements provided in Illustrations 2-5 through 2-11 (SEE BELOW), compute ratios for the City of Salem. Assume the population of Salem is 52,000 and the fair value of property totals $970 million. b. For each ratio, indicate which of the two governments has a stronger financial position. (Round "Debt per Capita" answer to the nearest whole dollar and other answers to 2 decimal places.)

To complete the question, fill in the "City of Salem" column.

Illustrations 2-5 through 2-11

City of Salem % (1) Financial Position (government-wide, governmental activities) (2) Financial Position (General Fund) (3) Quick Ratio (government-wide, governmental activities) (4) Leverage (government-wide, primary government) (5) Debt Service Coverage (enterprise funds) (6) Debt Service to Total Expenditures (governmental fund-basis) Debt per Capita (government-wide, primary government) (8) Debt to Assessed Value of Property (government-wide, primary government) Village of Riverside 15 % 11 % 2.32 0.11 2.7 times 4 % $ 468 4.68 % Stronger Ratio City of Salem City of Salem Village of Riverside Village of Riverside Village of Riverside Village of Riverside Village of Riverside Village of Riverside times Example Comprehensive Annual Financial Report Financial Section: Basic Financial Statements Government-wide Financial Statements: Statement of Net Position Component Units $ 84.733 ILLUSTRATION 2-5 Statement of Net Position CITY OF SALEM Statement of Net Position As of December 31, 2017 Primary Government Governmental Business-type Primary Assets Activities Activities Government Cash and cash equivalents $ 8,242,998 $ 4,814,724 $13,057,722 Investments 3,312,992 10,350,334 13,663,326 Inventory 1,072,963 30,779 1,103,742 Receivables (net: Taxes receivable 2,872,611 2.872,611 Accounts receivable 722.215 2.657,326 3,379,541 Due from other governments 1,328,448 1,328,448 Restricted assets 3,933,126 2,295,043 6,228,169 Capital assets (net of accumulated depreciation 65,690,373 48,894,402 114,584,775 Total assets 87,175,726 69,042,60B 156,218,334 27,085 11,170.900 11,282,718 710 2.425,447 4,340,105 493,849 473,168 2,919,296 4,813,276 2,164,521 1,342,717 3,507,238 Liabilities Accounts payable Accrued liabilities Bonds payable due within one year Bonds payable due in more than one year Total liabilities Net position Net investment in capital assets Restricted Unrestricted Total net position 39,834,882 48.764,958 18,858,187 21,167,921 58,693,069 69,932,879 710 11.197.985 23,690,970 3,933,126 10,786,672 $38,410,768 30,757,135 2.295,043 14,822,509 $47,874,687 54,448,105 6,228,169 25,609,181 $86,285,455 84,023 $11,282,000 Financial Section: Basic Financial Statements Government-wide Financial Statements: Statement of Activities ILLUSTRATION 2-6 Statement of Activities CITY OF SALEM Statement of Active For the Year Ended December 31, 2017 Primary Government Program Revenues Net (Expense Revenue and Change in Net Position Operation Capital Business Charges for Grand Grants and Government type Services Contributions Contribution Active Advies Component Expo $ Function Programs Govermental activities General government Judicial intration Posty Public Work Health and were Education Paries and recreation Community development Intran long-term dubt Total grimmutal activities Business-type activities $ 3.734,00 1433650 9.265,992 6.167.650 4436534 $1,144,018 56,497 275432 $ 262,178 1,000 525 750,100 2,903 982 2861389 73.300 302672 290 495 277.700 1,852,091 4.203 $2.926,8721 27462 0.962.606 (1.410.5771 (1.570,9421 219.1271 2.900,705 (1 213,654 1.422 423 022 810,622 182,326872) (374628) (7,962.6061 (1,410 577) (1.570 942) 2,219,127) 2,300,705) (1,213 654) (1 422 426 22 810 22 604,959 51,611 500 156361 3217,236 1,720, 121 14224 40 800.111 2.131,972 8.455 650 2.201855 6,385 233 3,109 692 2,085064 6594 Parking Total business-type activities Total primary common Component unita Industrial development authority 8041,987 2.556,633 481.869 40 49.720 261,107 8207273 11.120.750 9.452.938 1886,458 020 762 5.118.634 5.11.634 3,452938 1,886458 2016 5,118634 22.69190 6504 8,462 244 5.104.756 7,486 611 (27 810 620 4,322,849 4,192,964 20.000 General revenues Property teases Sales Hotel andmete Gants Miscellaneous Transfers Total generale Change innat po Net position, beginning Net position ending 15.382,482 5.729,224 4.990.045 2,724,725 2.341,374 1,172 15,382,482 5,729,224 4,990,045 2,724,725 1,611 886 6152 31,061,424 3,250,795 95.159.973 $58,410,768 72948 (6150521 114426 5293 060 42 641,627 $47874,687 1.172 31.175850 2453455 77.801.800 $86, 285,455 112974 $1128200 ILLUSTRATION 2-7a Reconciliation to (Government-wide) Statement of Net Position Fund balance reported in the Governmental Funds Balance Sheet $12.992.626 Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets used in government operations are not financial resources and therefore are not reported in the funds. 65.690.373 Some liabilities are not due and payable in the current period and are not reported in fund liabilities. 141,999,403) The assets and liabilities of internal service funds are included in governmental activities for the Statement of Net Position 436,475 Accrued liabilities that are not to be paid from current financial resources are not recognized in the funds. (3,117,390) Receivables on the Statement of Net Position that do not provide current financial resources are reported as deferred inflows in the funds. 4,408,087 Net position of governmental activities in the Statement of Net Position $38.410.768 ILLUSTRATION 2-7b Governmental Funds Balance Sheet CITY OF SALEM Balance Sheet Governmental Funds As of December 31, 2017 Special Courthouse Debt Total General Revenue Renovation Service Governmental Assets Fund Fund Fund Fund Funds Cash and cash equivalents $ 6,408214 $627,837 $ 895,300 $230,000 $ 8,161,351 Investments 3.312,992 3,312,992 Receivables (net) Taxes receivable 2872,611 2.872,611 Accounts receivable 679.215 14,177 693,392 Due from other governments 1,085,184 243,264 1,328,448 Supplies inventory 23,747 23,747 Restricted assets 3.933.126 3,933,126 Total assets $18.315.089 $642,014 $1,138,564 $230,000 $20,325,667 Liabilities Accounts payable 2,085 358 70,000 207,134 2.362,492 Accrued liabilities 543,064 19,398 562,462 Total liabilities 2,628,422 70,000 226,532 2,924,954 Deferred Inflows of Resources Property taxes 4.408.087 4,408,087 Total deferred inflows 4.408.087 4,408,087 Fund Balance Nonspendable - Supplies inventory 23,747 23,747 Restricted - Intergovernmental grants 312.000 500,000 812.000 -Bond sinking fund 230.000 230,000 Committed - Rainy day fund 4.500.000 4,500,000 - Courthouse renovation 380,000 380,000 Assigned - School lunch program 260,014 260,014 - Other capital projects 917,300 32,032 949,332 Unassigned 5.837,533 5,837,533 Total fund balance 11,278,580 572,014 912.032 230.000 12,992.626 Total liabilities deferred inflows and fund balance $18,315,089 $642,014 $1,138,564 $230,000 $20.325,667 ILLUSTRATION 2-8a Reconciliation to (Government-wide) Statement of Activities $11,485,357) 10.924.818 19,675,400) Excess of revenues and other sources over expenditures and other uses reported in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance Amounts reported for governmental activities in the Statement of Activities are different because . Governmental funds report the cost of capital assets as expenditures, while they are capital assets in the government-wide statements. Debt proceeds provide current financial resources to the governmental funds but are liabilities in the government-wide statements. Depreciation is not recorded in the governmental funds, but is expensed in the Statement of Activities. Income earned by internal service funds is included in governmental activities on government-wide statements. Payments of principal on long-term debt are expenditures in the governmental funds but reduce the liability in the government-wide statements. Property taxes expected to be collected more than 60 days after year-end are deferred in the governmental funds. Change in net position of governmental activities (government-wide) (1,691,116) 23,964 1,155,326 3,998,560 $3,250,795 ILLUSTRATION 2-8b Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance Total Governmental $15,361,830 11,761.522 1,892,678 10.996,440 1,262,549 41,275,019 CITY OF SALEM Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds For the Year Ended December 31, 2017 Special Courthouse Debt General Revenue Renovation Service Revenues Property taxes $15,361,830 $ $ $ Other local taxes 11,761,522 Charges for services 1,601,435 291,243 Intergovernmental 7.098.698 3.456,194 441,548 Miscellaneous 1.262.549 Total revenues 37,086,034 3.747,437 441,548 Expenditures Current: General government 3,353,502 Judicial administration 1.456.734 1.981,144 Public safety 8.216.347 Public works 4,602 273 Health and welfare 4.418.294 Education 8,887834 Parks and recreation 3,055 325 Community development 899,209 1,093,804 Capital outlay 10,924,818 Debt service: Principal 1,155,326 Interest 924,818 Total expenditures 34,889,518 3.074,948 10,924,818 2,080,144 Revenues over (under) expenditures 2.196516 672,489 (10,483,270) (2,080,144) Other financing sources (uses) Issuance of debt 9,675,400 Transfers from other funds 2,080,144 Transfers to other funds (3.256.899) (289,593) Total other financing sources (uses) (3.256.899) (289,593) 9,675,400 2,080,144 Excess of revenues and other sources over under) expenditures and other uses (1,060,383) 382.896 (807,870) Fund balance beginning of year 12.338.963 189,118 1.719,902 230,000 Fund balance end of year $11278,580 $572,014 $912,032 $230,000 3,353,502 3,437,878 8,216,347 4,602,273 4,418,294 8,887,834 3,055,325 1.993,013 10,924,818 1,155,326 924,818 50.969,428 19,694,409) 9,675,400 2,080,144 (3,546,492 8,209,052 (1,485,357) 14,477,983 $12.992,626 ILLUSTRATION 2-9 Proprietary Funds: Statement of Net Position CITY OF SALEM Statement of Net Position-Proprietary Funds As of December 31, 2017 Governmental Activities Internal Business-type Activities-Enterprise Funds Service Assets Water Solid Waste Parking Total Fund Current assets Cash and cash equivalents $ 3,801,978 $ 847.889 $ 164,857 $ 4,814,724 $ 81,647 Investments 4,433,039 5.917295 10,350,334 Inventory 30,779 30,779 330,759 Receivables (net) Accounts receivable 2,307,643 342.394 7,289 2,657,326 Due from other funds 28,824 Restricted assets 1,394,787 900.256 2,295,043 Total current assets 11.968.226 8.007.834 172,146 20,148,206 441.230 Noncurrent assets Capital assets (net of accumulated depreciation 37,975,852 4,611,754 6,306,796 48,894,402 68,603 Total assets $49,944,078 $12.619.588 $6,478,942 $69,042,608 $509,833 Liabilities Current liabilities: Accounts payable 317,131 174,087 2,631 493,849 62.958 Accrued liabilities 437,363 25,854 9.951 473,168 3,309 Total current liabilities 754,494 199.941 12,582 967,017 66,267 Liability for landfill closure and postclosure care costs 2,063.637 2,063,637 Capital leases payable 7,091 Bonds payable 16,114,097 2,023,170 18,137,267 Total noncurrent liabilities 16,114,097 2,063,637 2,023,170 20,200,904 7,091 Total liabilities 16,368,591 2.263,578 2,035,752 21,167,921 73,358 Net position Net investment in capital assets Restricted Unrestricted Total net position 21,861,755 4,611,754 4,283,626 30,757,135 61,512 1,394,787 900,256 2,295,043 9,818.945 4.844.000 159,564 14,822,509 374,963 $33,075,487 $10.356 010 54,443,190 $47,874,687 5436,475 ILLUSTRATION 2-10 Proprietary Funds: Statement of Revenues, Expenses, and Changes in Fund Net Position CITY OF SALEM Statement of Revenues, Expenses, and Changes in Fund Net Position-Proprietary Funds For the Year Ended December 31, 2017 Governmental Activities Internal Business-type Activities-Enterprise Funds Service Water Solid Waste Parking Total Fund Operating revenues Charges for services $ 6,335,022 $ 2.292.322 $ 261,088 $ 8,888,432 $663,162 Miscellaneous 45,499 58.827 104,326 Total revenues 6,380,521 2.351,149 261,0BB 8,992,758 663,162 Operating expenses Personnel services 1,576,088 1,164,629 126,466 2,867,183 591,010 Repairs and maintenance 389,271 50 296 439,567 2.698 Contractual services 1.107.169 439.355 1,546,524 34,622 Depreciation 1,374,214 353,411 153,097 1,880,722 6,654 Utilities 186,195 1.173 40,619 227,987 100 Other 699,009 332.110 63.766 1,094,885 4,256 Landfill closure costs 215.659 215,659 Total operating expenses 5,331,946 2.556,633 383.948 8,272,527 639,340 Operating income (loss) 1,048,575 (205,484) (122,860) 720,231 23,822 Nonoperating revenues (expenses) Interest income 452,718 279,924 1,558 734,200 700 State aid 23,746 6.878 30,624 Interest expense 1710,042 197,901) 1807,943) (558) Total nonoperating revenue (233,578) 286.802 196,343) 143,119) 142 Income before contributions and transfers 814,997 81,318 (219,203) 677,112 23.964 Capital contributions 3,085,946 2,085,064 5,171,010 Transfers in 179,440 179,440 Transfers out 192,300 (702,202) (794,502 Change in net position 3,808,643 1,464,180 (39,763) 5,233,060 23,964 Net position-beginning 29,266,844 8,891,830 4,482,953 42,641,627 412.511 Net position-end of year $33,075,487 $10.356,010 $4,443,190 $47,874,687 $436,475 of year ILLUSTRATION 2-11 Proprietary Funds: Statement of Cash Flows CITY OF SALEM Statement of Cash Flows Proprietary Funds For the Year Ended December 31, 2017 Governmental Activities Internal Service Fund Total $649,426 1630,437) $8,991,395 (3,392.741) (1,811,584) 1961,875) 2,825,194 18,989 6.594 179,440 1794,502) 1508,468) 1999,348 (1,143,307 1631,528 (3,719 (2,774,183 (3,719 Business-type Activities-Enterprise Funds Water Solid Waste Parking Cash flows from operating activities Cash received from customers $6,388,018 $2.343.431 $259,946 Cash paid to suppliers 12,490,241) 1822363 (80.137) Cash paid to employees 1948,035 1754032 (99,517) Other 1588,974 (322.472 (50.430) Not cash provided by operating activities 2,360,758 434.564 29,862 Cash flows from noncapital financing activities Operating grants received 6.594 Transfors from other funds 179,440 Transfers to other funds (92,300 (702. 2023 Not cash provided by noncapital financing activities 192,300 1595 608 179,440 Cash flows from capital and related financing activities Acquisition of capital assets 1543,169 (456.179) Principal paid on long-term debt 11,014,887) (128,420) Interest paid 1535,567 (95,961) Not cash provided from capital and related financing activities 12,093,623) (456.179) (224.381) Cash flows from investing activities Interest received 287,725 279.924 1,558 Not cash provided from investing activities 287,725 279.924 1,558 Increase in cash 462,570 1437299 (13,521) Cash and cash equivalents beginning of your 4,734,195 2,185 444 178,378 Cash and cash equivalents- end of year $5,196,765 $1,748.145 $164,857 Reconciliation of operating income to net cash provided by operating activities: Operating income 1,048,575 (205.484) (122,860) Depreciation 1,374,214 353.411 153,097 Increaso) decrease in receivables 21,097 122,828 (375) Increase) decrease in inventory Increase decrease in accounts payable (83,118) Increase in landil closureliability 163.809 Not cash provided by operating activities $2,360,758 $ 434 564 $ 29,862 Noncash investing, capital and financing activities: Contributions of capital assets from developers $3,085,946 $2,085 064 $ 569,207 700 569 207 11,750 700 15,970 7,098 017 65,677 $7,109,767 $ 81,647 720,231 1,880,722 143,550 23,822 6,654 (13,739 (46,535 48,784 (83,118) 163,809 $2,825,194 $ 18,989 $5,171.000 5 City of Salem % (1) Financial Position (government-wide, governmental activities) (2) Financial Position (General Fund) (3) Quick Ratio (government-wide, governmental activities) (4) Leverage (government-wide, primary government) (5) Debt Service Coverage (enterprise funds) (6) Debt Service to Total Expenditures (governmental fund-basis) Debt per Capita (government-wide, primary government) (8) Debt to Assessed Value of Property (government-wide, primary government) Village of Riverside 15 % 11 % 2.32 0.11 2.7 times 4 % $ 468 4.68 % Stronger Ratio City of Salem City of Salem Village of Riverside Village of Riverside Village of Riverside Village of Riverside Village of Riverside Village of Riverside times Example Comprehensive Annual Financial Report Financial Section: Basic Financial Statements Government-wide Financial Statements: Statement of Net Position Component Units $ 84.733 ILLUSTRATION 2-5 Statement of Net Position CITY OF SALEM Statement of Net Position As of December 31, 2017 Primary Government Governmental Business-type Primary Assets Activities Activities Government Cash and cash equivalents $ 8,242,998 $ 4,814,724 $13,057,722 Investments 3,312,992 10,350,334 13,663,326 Inventory 1,072,963 30,779 1,103,742 Receivables (net: Taxes receivable 2,872,611 2.872,611 Accounts receivable 722.215 2.657,326 3,379,541 Due from other governments 1,328,448 1,328,448 Restricted assets 3,933,126 2,295,043 6,228,169 Capital assets (net of accumulated depreciation 65,690,373 48,894,402 114,584,775 Total assets 87,175,726 69,042,60B 156,218,334 27,085 11,170.900 11,282,718 710 2.425,447 4,340,105 493,849 473,168 2,919,296 4,813,276 2,164,521 1,342,717 3,507,238 Liabilities Accounts payable Accrued liabilities Bonds payable due within one year Bonds payable due in more than one year Total liabilities Net position Net investment in capital assets Restricted Unrestricted Total net position 39,834,882 48.764,958 18,858,187 21,167,921 58,693,069 69,932,879 710 11.197.985 23,690,970 3,933,126 10,786,672 $38,410,768 30,757,135 2.295,043 14,822,509 $47,874,687 54,448,105 6,228,169 25,609,181 $86,285,455 84,023 $11,282,000 Financial Section: Basic Financial Statements Government-wide Financial Statements: Statement of Activities ILLUSTRATION 2-6 Statement of Activities CITY OF SALEM Statement of Active For the Year Ended December 31, 2017 Primary Government Program Revenues Net (Expense Revenue and Change in Net Position Operation Capital Business Charges for Grand Grants and Government type Services Contributions Contribution Active Advies Component Expo $ Function Programs Govermental activities General government Judicial intration Posty Public Work Health and were Education Paries and recreation Community development Intran long-term dubt Total grimmutal activities Business-type activities $ 3.734,00 1433650 9.265,992 6.167.650 4436534 $1,144,018 56,497 275432 $ 262,178 1,000 525 750,100 2,903 982 2861389 73.300 302672 290 495 277.700 1,852,091 4.203 $2.926,8721 27462 0.962.606 (1.410.5771 (1.570,9421 219.1271 2.900,705 (1 213,654 1.422 423 022 810,622 182,326872) (374628) (7,962.6061 (1,410 577) (1.570 942) 2,219,127) 2,300,705) (1,213 654) (1 422 426 22 810 22 604,959 51,611 500 156361 3217,236 1,720, 121 14224 40 800.111 2.131,972 8.455 650 2.201855 6,385 233 3,109 692 2,085064 6594 Parking Total business-type activities Total primary common Component unita Industrial development authority 8041,987 2.556,633 481.869 40 49.720 261,107 8207273 11.120.750 9.452.938 1886,458 020 762 5.118.634 5.11.634 3,452938 1,886458 2016 5,118634 22.69190 6504 8,462 244 5.104.756 7,486 611 (27 810 620 4,322,849 4,192,964 20.000 General revenues Property teases Sales Hotel andmete Gants Miscellaneous Transfers Total generale Change innat po Net position, beginning Net position ending 15.382,482 5.729,224 4.990.045 2,724,725 2.341,374 1,172 15,382,482 5,729,224 4,990,045 2,724,725 1,611 886 6152 31,061,424 3,250,795 95.159.973 $58,410,768 72948 (6150521 114426 5293 060 42 641,627 $47874,687 1.172 31.175850 2453455 77.801.800 $86, 285,455 112974 $1128200 ILLUSTRATION 2-7a Reconciliation to (Government-wide) Statement of Net Position Fund balance reported in the Governmental Funds Balance Sheet $12.992.626 Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets used in government operations are not financial resources and therefore are not reported in the funds. 65.690.373 Some liabilities are not due and payable in the current period and are not reported in fund liabilities. 141,999,403) The assets and liabilities of internal service funds are included in governmental activities for the Statement of Net Position 436,475 Accrued liabilities that are not to be paid from current financial resources are not recognized in the funds. (3,117,390) Receivables on the Statement of Net Position that do not provide current financial resources are reported as deferred inflows in the funds. 4,408,087 Net position of governmental activities in the Statement of Net Position $38.410.768 ILLUSTRATION 2-7b Governmental Funds Balance Sheet CITY OF SALEM Balance Sheet Governmental Funds As of December 31, 2017 Special Courthouse Debt Total General Revenue Renovation Service Governmental Assets Fund Fund Fund Fund Funds Cash and cash equivalents $ 6,408214 $627,837 $ 895,300 $230,000 $ 8,161,351 Investments 3.312,992 3,312,992 Receivables (net) Taxes receivable 2872,611 2.872,611 Accounts receivable 679.215 14,177 693,392 Due from other governments 1,085,184 243,264 1,328,448 Supplies inventory 23,747 23,747 Restricted assets 3.933.126 3,933,126 Total assets $18.315.089 $642,014 $1,138,564 $230,000 $20,325,667 Liabilities Accounts payable 2,085 358 70,000 207,134 2.362,492 Accrued liabilities 543,064 19,398 562,462 Total liabilities 2,628,422 70,000 226,532 2,924,954 Deferred Inflows of Resources Property taxes 4.408.087 4,408,087 Total deferred inflows 4.408.087 4,408,087 Fund Balance Nonspendable - Supplies inventory 23,747 23,747 Restricted - Intergovernmental grants 312.000 500,000 812.000 -Bond sinking fund 230.000 230,000 Committed - Rainy day fund 4.500.000 4,500,000 - Courthouse renovation 380,000 380,000 Assigned - School lunch program 260,014 260,014 - Other capital projects 917,300 32,032 949,332 Unassigned 5.837,533 5,837,533 Total fund balance 11,278,580 572,014 912.032 230.000 12,992.626 Total liabilities deferred inflows and fund balance $18,315,089 $642,014 $1,138,564 $230,000 $20.325,667 ILLUSTRATION 2-8a Reconciliation to (Government-wide) Statement of Activities $11,485,357) 10.924.818 19,675,400) Excess of revenues and other sources over expenditures and other uses reported in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance Amounts reported for governmental activities in the Statement of Activities are different because . Governmental funds report the cost of capital assets as expenditures, while they are capital assets in the government-wide statements. Debt proceeds provide current financial resources to the governmental funds but are liabilities in the government-wide statements. Depreciation is not recorded in the governmental funds, but is expensed in the Statement of Activities. Income earned by internal service funds is included in governmental activities on government-wide statements. Payments of principal on long-term debt are expenditures in the governmental funds but reduce the liability in the government-wide statements. Property taxes expected to be collected more than 60 days after year-end are deferred in the governmental funds. Change in net position of governmental activities (government-wide) (1,691,116) 23,964 1,155,326 3,998,560 $3,250,795 ILLUSTRATION 2-8b Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance Total Governmental $15,361,830 11,761.522 1,892,678 10.996,440 1,262,549 41,275,019 CITY OF SALEM Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds For the Year Ended December 31, 2017 Special Courthouse Debt General Revenue Renovation Service Revenues Property taxes $15,361,830 $ $ $ Other local taxes 11,761,522 Charges for services 1,601,435 291,243 Intergovernmental 7.098.698 3.456,194 441,548 Miscellaneous 1.262.549 Total revenues 37,086,034 3.747,437 441,548 Expenditures Current: General government 3,353,502 Judicial administration 1.456.734 1.981,144 Public safety 8.216.347 Public works 4,602 273 Health and welfare 4.418.294 Education 8,887834 Parks and recreation 3,055 325 Community development 899,209 1,093,804 Capital outlay 10,924,818 Debt service: Principal 1,155,326 Interest 924,818 Total expenditures 34,889,518 3.074,948 10,924,818 2,080,144 Revenues over (under) expenditures 2.196516 672,489 (10,483,270) (2,080,144) Other financing sources (uses) Issuance of debt 9,675,400 Transfers from other funds 2,080,144 Transfers to other funds (3.256.899) (289,593) Total other financing sources (uses) (3.256.899) (289,593) 9,675,400 2,080,144 Excess of revenues and other sources over under) expenditures and other uses (1,060,383) 382.896 (807,870) Fund balance beginning of year 12.338.963 189,118 1.719,902 230,000 Fund balance end of year $11278,580 $572,014 $912,032 $230,000 3,353,502 3,437,878 8,216,347 4,602,273 4,418,294 8,887,834 3,055,325 1.993,013 10,924,818 1,155,326 924,818 50.969,428 19,694,409) 9,675,400 2,080,144 (3,546,492 8,209,052 (1,485,357) 14,477,983 $12.992,626 ILLUSTRATION 2-9 Proprietary Funds: Statement of Net Position CITY OF SALEM Statement of Net Position-Proprietary Funds As of December 31, 2017 Governmental Activities Internal Business-type Activities-Enterprise Funds Service Assets Water Solid Waste Parking Total Fund Current assets Cash and cash equivalents $ 3,801,978 $ 847.889 $ 164,857 $ 4,814,724 $ 81,647 Investments 4,433,039 5.917295 10,350,334 Inventory 30,779 30,779 330,759 Receivables (net) Accounts receivable 2,307,643 342.394 7,289 2,657,326 Due from other funds 28,824 Restricted assets 1,394,787 900.256 2,295,043 Total current assets 11.968.226 8.007.834 172,146 20,148,206 441.230 Noncurrent assets Capital assets (net of accumulated depreciation 37,975,852 4,611,754 6,306,796 48,894,402 68,603 Total assets $49,944,078 $12.619.588 $6,478,942 $69,042,608 $509,833 Liabilities Current liabilities: Accounts payable 317,131 174,087 2,631 493,849 62.958 Accrued liabilities 437,363 25,854 9.951 473,168 3,309 Total current liabilities 754,494 199.941 12,582 967,017 66,267 Liability for landfill closure and postclosure care costs 2,063.637 2,063,637 Capital leases payable 7,091 Bonds payable 16,114,097 2,023,170 18,137,267 Total noncurrent liabilities 16,114,097 2,063,637 2,023,170 20,200,904 7,091 Total liabilities 16,368,591 2.263,578 2,035,752 21,167,921 73,358 Net position Net investment in capital assets Restricted Unrestricted Total net position 21,861,755 4,611,754 4,283,626 30,757,135 61,512 1,394,787 900,256 2,295,043 9,818.945 4.844.000 159,564 14,822,509 374,963 $33,075,487 $10.356 010 54,443,190 $47,874,687 5436,475 ILLUSTRATION 2-10 Proprietary Funds: Statement of Revenues, Expenses, and Changes in Fund Net Position CITY OF SALEM Statement of Revenues, Expenses, and Changes in Fund Net Position-Proprietary Funds For the Year Ended December 31, 2017 Governmental Activities Internal Business-type Activities-Enterprise Funds Service Water Solid Waste Parking Total Fund Operating revenues Charges for services $ 6,335,022 $ 2.292.322 $ 261,088 $ 8,888,432 $663,162 Miscellaneous 45,499 58.827 104,326 Total revenues 6,380,521 2.351,149 261,0BB 8,992,758 663,162 Operating expenses Personnel services 1,576,088 1,164,629 126,466 2,867,183 591,010 Repairs and maintenance 389,271 50 296 439,567 2.698 Contractual services 1.107.169 439.355 1,546,524 34,622 Depreciation 1,374,214 353,411 153,097 1,880,722 6,654 Utilities 186,195 1.173 40,619 227,987 100 Other 699,009 332.110 63.766 1,094,885 4,256 Landfill closure costs 215.659 215,659 Total operating expenses 5,331,946 2.556,633 383.948 8,272,527 639,340 Operating income (loss) 1,048,575 (205,484) (122,860) 720,231 23,822 Nonoperating revenues (expenses) Interest income 452,718 279,924 1,558 734,200 700 State aid 23,746 6.878 30,624 Interest expense 1710,042 197,901) 1807,943) (558) Total nonoperating revenue (233,578) 286.802 196,343) 143,119) 142 Income before contributions and transfers 814,997 81,318 (219,203) 677,112 23.964 Capital contributions 3,085,946 2,085,064 5,171,010 Transfers in 179,440 179,440 Transfers out 192,300 (702,202) (794,502 Change in net position 3,808,643 1,464,180 (39,763) 5,233,060 23,964 Net position-beginning 29,266,844 8,891,830 4,482,953 42,641,627 412.511 Net position-end of year $33,075,487 $10.356,010 $4,443,190 $47,874,687 $436,475 of year ILLUSTRATION 2-11 Proprietary Funds: Statement of Cash Flows CITY OF SALEM Statement of Cash Flows Proprietary Funds For the Year Ended December 31, 2017 Governmental Activities Internal Service Fund Total $649,426 1630,437) $8,991,395 (3,392.741) (1,811,584) 1961,875) 2,825,194 18,989 6.594 179,440 1794,502) 1508,468) 1999,348 (1,143,307 1631,528 (3,719 (2,774,183 (3,719 Business-type Activities-Enterprise Funds Water Solid Waste Parking Cash flows from operating activities Cash received from customers $6,388,018 $2.343.431 $259,946 Cash paid to suppliers 12,490,241) 1822363 (80.137) Cash paid to employees 1948,035 1754032 (99,517) Other 1588,974 (322.472 (50.430) Not cash provided by operating activities 2,360,758 434.564 29,862 Cash flows from noncapital financing activities Operating grants received 6.594 Transfors from other funds 179,440 Transfers to other funds (92,300 (702. 2023 Not cash provided by noncapital financing activities 192,300 1595 608 179,440 Cash flows from capital and related financing activities Acquisition of capital assets 1543,169 (456.179) Principal paid on long-term debt 11,014,887) (128,420) Interest paid 1535,567 (95,961) Not cash provided from capital and related financing activities 12,093,623) (456.179) (224.381) Cash flows from investing activities Interest received 287,725 279.924 1,558 Not cash provided from investing activities 287,725 279.924 1,558 Increase in cash 462,570 1437299 (13,521) Cash and cash equivalents beginning of your 4,734,195 2,185 444 178,378 Cash and cash equivalents- end of year $5,196,765 $1,748.145 $164,857 Reconciliation of operating income to net cash provided by operating activities: Operating income 1,048,575 (205.484) (122,860) Depreciation 1,374,214 353.411 153,097 Increaso) decrease in receivables 21,097 122,828 (375) Increase) decrease in inventory Increase decrease in accounts payable (83,118) Increase in landil closureliability 163.809 Not cash provided by operating activities $2,360,758 $ 434 564 $ 29,862 Noncash investing, capital and financing activities: Contributions of capital assets from developers $3,085,946 $2,085 064 $ 569,207 700 569 207 11,750 700 15,970 7,098 017 65,677 $7,109,767 $ 81,647 720,231 1,880,722 143,550 23,822 6,654 (13,739 (46,535 48,784 (83,118) 163,809 $2,825,194 $ 18,989 $5,171.000 5