Problem 17-44 (Algo) (LO 17-7, 17-8, 17-9, 17-11)

The City of Pfeiffer starts the year of 2020 with the general fund and an enterprise fund. The general fund has two activities: education and parks/recreation. For convenience, assume that the general fund holds $147,000 cash and a new school building costing $800,000. The city utilizes straight-line depreciation. The building has a 20-year life and no residual value. The enterprise fund has $82,800 cash and a new $600,000 civic auditorium with a 30-year life and no residual value. The enterprise fund monitors one activity, the rental of the civic auditorium for entertainment and other cultural affairs.

The following transactions for the city take place during 2020. Assume that the citys fiscal year ends on December 31.

Decides to build a municipal park and transfers cash of $105,000 into a capital projects fund. Both the creation of this fund and the transfer were made by the highest level of government authority. The city immediately expends $30,500 to acquire three acres of land.

Borrows $168,400 cash on a long-term bond for use in creating the new municipal park.

Assesses property taxes on the first day of the year. The assessment, which is immediately enforceable, totals $918,900. Of this amount, $781,000 will be collected during 2020. Officials expect another $76,900 during the first month of 2021. They anticipate the remainder halfway through 2021.

Constructs a covered building in the new municipal park for 76,000 cash so that local citizens can play basketball when it rains. The building is put into service on July 1. It should last 10 years with no expected residual value.

Builds a sidewalk through the new park for $40,000 cash and puts it into service on July 1. The sidewalk should normally last for 10 years, but the city plans to keep it fixed up to a predetermined quality level so that it can last almost indefinitely.

Opens the park and charges an entrance fee of only a token amount. The city reports the park within its general fund. Collections during the first year of operations total $7,600.

Buys a new parking deck for $200,000, paying $20,000 cash and signing a long-term note for the rest. The parking deck, which goes into operation on July 1, is across the street from the civic auditorium and is considered part of that activity. It has a 20-year life and no residual value.

Receives a $100,000 cash grant for the city school system that must be spent for school lunches for children in low-income families. Officials view the appropriate spending of these funds as an eligibility requirement of this grant. During the current year, $37,100 of the amount received was spent for the intended purpose.

Charges students in the school system a total fee of $6,000 for books and the like. Of this amount, 90 percent is collected during 2020 with the remainder expected to be collected in the first few weeks of 2021.

Buys school supplies for $21,000 cash and uses $16,200 of them. The general fund applies the purchases method.

Receives a painting by a local artist to be displayed in the local school. It qualifies as a work of art, and officials have chosen not to capitalize it. The painting has a value of $76,000. Officials have set up security precautions so that the painting will be viewed as inexhaustible.

Transfers $30,500 cash from the general fund to the enterprise fund as a capital contribution.

Orders a school bus for $151,500.

Receives the school bus and pays an actual cost of $155,600 including transportation and other necessary costs. The bus goes into operation on October 1. It should last for five years with no residual value.

Pays salaries of $365,800 to school teachers. In addition, owes and will pay $45,100 during the first two weeks of 2021. Vacations worth $34,600 have also been earned by the teachers but will not be taken until July 2021.

Pays salaries of $62,800 to city auditorium workers. In addition, owes and will pay $10,300 in the first two weeks of 2021. Vacations worth $17,200 have also been earned by the workers but will not be taken until July 2021.

Charges customers $447,200 for short-term rental of the civic auditorium. Of this balance, collects $378,400 in cash and will collect the remainder in April 2021.

Pays $31,000 maintenance charges for the building and sidewalk in (d) and (e).

Pays $48,200 on the bond in (b) on the last day of 2020: $17,200 principal and $31,000 interest.

Accrues interest of $44,800 on the note in (g) as of the end of 2020, an amount that it will pay in June 2021.

Assumes a museum operating within the city is a component unit that will be discretely presented. The museum reports to city officials that it incurred $144,700 of direct expenses this past year and earned $172,300 in revenues from admission charges. The only assets held at year-end were cash of $82,700, building (net of depreciation) of $1,034,300, and a long-term liability of $724,200.

Prepare the 2020 government-wide financial statements for this city. Assume the use of the modified approach.

Complete this question by entering your answers in the tabs below.

Stmt of Activities

Prepare a statement of activities.

Stmt of Activities
Statement of Activities
Government-Wide Financial Statements
Year Ending December 31, 2020
				Net (Expenses) Revenues and Changes in Net Position
	Expenses	Program Revenues	Grants and Gifts	Governmental	Business-Type	Total	Component Unit
Governmental activities:
Education						$0
Parks and recreation						0
Total for governmental activities	$0	$0	$0	$0		$0
Business-type activities:
Civic auditorium						0
Total for primary government	$0	$0	$0	$0	$0	$0
Component unit:
Museum
General revenues:
Property taxes						0
Transfers						0
Total general revenues and transfers				$0	$0	$0
Change in net assets				$0	$0	$0	$0
Net assets, beginning of year						0
Net Assets, end of Year				$0	$0	$0	$0