PROBLEM 6 The City establishes an Internal Service Fund (ISF) to account for the costs of printing services that it will provide to the various City departments Make journal entries to record the following transactions in the ISF only 1 The General Fund transfers $655,000 to the ISF as a contribution to start the printing activity 2 The ISF immediately uses $600,000 of the cash to purchase printing equipment (The printing equipment is estimated to have an average useful life of 10 years ) 3 On various occasions during the year, the ISF buys paper and other supplies in the amount of $70,000 on open account The supplies are put into inventory 4 Invoices for the supplies purchased in 3 , above are paid 5 Employee salaries for the year amounting to $275,000 are paid The ISF makes a payment of $40,500 to the City's Pension Trust Fund for pensions applicable to the salaries of its personnel The ISF receives an invoice of $35,000 from the General Fund for occupancy costs, which includes space and utility costs The ISF sends invoices throughout the year to several City agencies for printing services, as follows (1) To General Fund departments $75,000 (2) To the Water Enterprise Fund 55,000 9 The ISF receives payments of $75,000 from General Fund agencies and $55,000 from the Water Enterprise Fund To prepare its financial statements, the ISF makes adjusting entries to account for the following 10 To record nine months of depreciation on the equipment purchased in 2 , above 11 To record the expense of paper and supplies consumed during the year A year end inventory showed unused paper and supplies amounting to $10,000 (See 3 , above) 12 To record unpaid salaries of $20,500

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 15, 2024

PROBLEM 6 The City establishes an Internal Service Fund (ISF) to account for the costs of printing services that it will provide to the various

PROBLEM 6

The City establishes an Internal Service Fund (ISF) to account for the costs of printing services that it will provide to the various City departments. Make journal entries to record the following transactions in the ISF only.

1. The General Fund transfers $655,000 to the ISF as a contribution to start the printing activity.

2. The ISF immediately uses $600,000 of the cash to purchase printing equipment. (The printing equipment is estimated to have an average useful life of 10 years.)

3. On various occasions during the year, the ISF buys paper and other supplies in the amount of $70,000 on open account. The supplies are put into inventory.

4. Invoices for the supplies purchased in 3., above are paid.

5. Employee salaries for the year amounting to $275,000 are paid

The ISF makes a payment of $40,500 to the City's Pension Trust Fund for pensions applicable to the salaries of its personnel.
The ISF receives an invoice of $35,000 from the General Fund for occupancy costs, which includes space and utility costs.
The ISF sends invoices throughout the year to several City agencies for printing services, as follows:

(1) To General Fund departments $75,000

(2) To the Water Enterprise Fund 55,000

9. The ISF receives payments of $75,000 from General Fund agencies and $55,000 from the Water Enterprise Fund.

To prepare its financial statements, the ISF makes adjusting entries to account for the following:

10. To record nine months of depreciation on the equipment purchased in 2., above.

11. To record the expense of paper and supplies consumed during the year. A year-end inventory showed unused paper and supplies amounting to $10,000. (See 3., above)

12. To record unpaid salaries of $20,500