PROBLEM 12-5

Case Study Week 7

(Fund Transactions Worksheets)*

General Fund - Modified Accrual Transactions Analysis Worksheet

Liabilities and Fund Balance

Assets

=

Liabilities

Fund Balance and Changes in Fund Balance

Real

Due to

Estate

State

Debt

Deferred

Taxes

Grants

Accounts

Service

Tax

Salaries

Fund

Cash

Receivable

Receivable

Payable

Fund

Revenue

Payable

Balance

Beginning Balance

$0

$0

Transaction # 1

General Government Expenditures

Education Expenditures

Public Works, Safety & Sanitation Expenditures

Transaction # 2

General Government Expenditures

Education Expenditures

Public Works, Safety & Sanitation Expenditures

Transaction # 3a

Real Estate Tax Revenues

Transaction # 3b

Transaction # 4a

State Grant Revenues

Transaction # 4b

Transaction # 5

Transfer to Debt Service Fund

Transaction # 6a

Transaction # 6b

Transaction # 7

_______

________

________

_____

_____

_____

______

________

Ending Balance

$0

$0

$0

=

$0

$0

$0

$0

$0

* Due to the implementation of GASB Statement No. 63 in 2012, the modified accrual transactions analysis worksheet should separately report Deferred Tax Revenues under Deferred Inflows of Resources. Because the new accounting equation for governments is not introduced until Chapter 14, however, the solution provided here is acceptable.

Debt Service Fund

Liabilities and Fund Balance

Assets

=

Liabilities

Fund Balance and Changes in Fund Balance

Due from

General

Fund

Cash

Fund

Balance

Beginning Balance

0

Transaction # 1

Transaction # 2

Transaction # 3

Transaction # 4

Transaction # 5

Transfer from General fund

Transaction # 6

Transaction # 7

Interest Expenditure

_______

______

______

Debt ServicePrincipal Expenditure

Ending Balance

$0

$0

=

$0

$0

Capital Projects Fund
Capital Projects Fund
						Liabilities and Fund Balance
			Assets		=	Liabilities		Fund Balance and Changes in Fund Balance
				Due from
				General				Fund
			Cash	Fund				Balance
		Beginning Balance	0	0		0		0
		Transaction # 1
		Transaction # 2
		Transaction # 3
		Transaction # 4
		Transaction # 5
		Transaction # 6a							Other Sources of FinancingNote Payable
		Transaction # 6b							Capital Outlay Expenditure
		Transaction # 7
			_______	____		____		____
		Ending Balance	0	0	=	0		0

12-4. 12-5. ENHIBIT 12-4 See Exhibit 12-4 for opening account balances. Record the following financial transactions for Simonsen Village for the fiscal year ending December 31, 2018. Sho the impact of the transactions on the fundamental equation of accounting (optional: show joumal entries see Appendix 12-A). Assume that the modified accrual basis is used Simonsen Village has employee who eamed $400,000 for the year. At the end of the year, the salaries payable balance was S10,000. Note that $200,000 of wages related to general govemment, $140.000 was for education, and S60.000 was for the public works, safety. and sanitation deparument. Inventory was ordered by Simonsen Village. The entire order was received. The bill for the inventory purchase was $10.000. By the end of the fiscal year, it had used $6,000 of the inventory, but no payment had been made The purchases method i used. Each of the three departments had used S2,000 of inventory The remaining inventory was all earmarked for education. Simonsen V ource of funds is real estate taxes. T otal tax bills issued were for $300,000. Total collection were the S20,000 from the previous year's llage s ending balance in taxes receivable and $260.000 of this year's taxes. Eighty percent of the outstanding balance at year-end is expected to be collected early in the next fiscal year. e state. During the year, grants in the amount of $100,000 were made. The total co Simonsen Village is entitled to receive unrestricted grants from th lections on grants were just S20.000. This S20.000 consisted of S10.000 that the state owed for the previous year and S10.000 for the current year grant. The state will be paying the balance owed to Simonsen Village within 30 days after the year ends During the year. Simonsen Village was legally required to transfer $60.000 to its debt service fund. A total of $70.000 of cash was paid to the debt service fund. In years when the full required transfer is not ma de, the debt service fund has a receivable (Due From General Fund. If more than the required amount is paid. the debt service fund's receivable declmes $200.000. The fire truck is expected to last 10 years and has no salvage value. Village acquired a new fire truck ear in the year for was financed by long-term note for the full amount. Simonsen Village has a capital projects fund. pal, due on Simonsen Village s debt during the year and paid from the debt service fund were $8.000 and S30.000. re The interest and princi pectively. The interest covers all long-term borrowing by Simonsen Vi age. The principal relates to the fire truck purchased during the year. Simonsen Village ty. At the start of the yea he governmen had no long-term assets or abilitie es. In fact, a of the infrastmcture (eg.. Toads) in a relatively new comm the villag e are owned by the county or state rather than town- However, the village governunent has the primary responsibility for putting out fires in the village. Transactions 6 and 7 for Simonsen Village, described in Problem 12-4, both relate to the town s new fire truck. Exhibit 12-4 presents January l, 2018. balances for Simonsen Village's accounts. These balances at the start of the year were the same on both the modified accrual and accrual base Hint That may not be the case at the end of the year) Show the beginning balances from Exhibi -4 and the transactions from Problen 12-4 work-sheet format similar to Exhib 2-3. Show ending balances. Make a separate section for each fund January 1, 2018. Balance General Fund Debt Service Fund Capital Projects Fund Cash $300,000 $4,000 Real estate taxes receivable 20,000 State grants receivable 10,000 Due from general fund 16,000 90,000 Salaries payable Due to debt service fund 16,000 Fund balance/unrestricted net assets 224,000 20,000 12-4. 12-5. ENHIBIT 12-4 See Exhibit 12-4 for opening account balances. Record the following financial transactions for Simonsen Village for the fiscal year ending December 31, 2018. Sho the impact of the transactions on the fundamental equation of accounting (optional: show joumal entries see Appendix 12-A). Assume that the modified accrual basis is used Simonsen Village has employee who eamed $400,000 for the year. At the end of the year, the salaries payable balance was S10,000. Note that $200,000 of wages related to general govemment, $140.000 was for education, and S60.000 was for the public works, safety. and sanitation deparument. Inventory was ordered by Simonsen Village. The entire order was received. The bill for the inventory purchase was $10.000. By the end of the fiscal year, it had used $6,000 of the inventory, but no payment had been made The purchases method i used. Each of the three departments had used S2,000 of inventory The remaining inventory was all earmarked for education. Simonsen V ource of funds is real estate taxes. T otal tax bills issued were for $300,000. Total collection were the S20,000 from the previous year's llage s ending balance in taxes receivable and $260.000 of this year's taxes. Eighty percent of the outstanding balance at year-end is expected to be collected early in the next fiscal year. e state. During the year, grants in the amount of $100,000 were made. The total co Simonsen Village is entitled to receive unrestricted grants from th lections on grants were just S20.000. This S20.000 consisted of S10.000 that the state owed for the previous year and S10.000 for the current year grant. The state will be paying the balance owed to Simonsen Village within 30 days after the year ends During the year. Simonsen Village was legally required to transfer $60.000 to its debt service fund. A total of $70.000 of cash was paid to the debt service fund. In years when the full required transfer is not ma de, the debt service fund has a receivable (Due From General Fund. If more than the required amount is paid. the debt service fund's receivable declmes $200.000. The fire truck is expected to last 10 years and has no salvage value. Village acquired a new fire truck ear in the year for was financed by long-term note for the full amount. Simonsen Village has a capital projects fund. pal, due on Simonsen Village s debt during the year and paid from the debt service fund were $8.000 and S30.000. re The interest and princi pectively. The interest covers all long-term borrowing by Simonsen Vi age. The principal relates to the fire truck purchased during the year. Simonsen Village ty. At the start of the yea he governmen had no long-term assets or abilitie es. In fact, a of the infrastmcture (eg.. Toads) in a relatively new comm the villag e are owned by the county or state rather than town- However, the village governunent has the primary responsibility for putting out fires in the village. Transactions 6 and 7 for Simonsen Village, described in Problem 12-4, both relate to the town s new fire truck. Exhibit 12-4 presents January l, 2018. balances for Simonsen Village's accounts. These balances at the start of the year were the same on both the modified accrual and accrual base Hint That may not be the case at the end of the year) Show the beginning balances from Exhibi -4 and the transactions from Problen 12-4 work-sheet format similar to Exhib 2-3. Show ending balances. Make a separate section for each fund January 1, 2018. Balance General Fund Debt Service Fund Capital Projects Fund Cash $300,000 $4,000 Real estate taxes receivable 20,000 State grants receivable 10,000 Due from general fund 16,000 90,000 Salaries payable Due to debt service fund 16,000 Fund balance/unrestricted net assets 224,000 20,000