Problem I. (80 points possible). Below is selected information on the post-closing trial balance of the General Fund at April 30, 2017, the last day of the 2017 fiscal year (FY 2017) of the town of Carey, a southern town in the Appalachian section of the state of North Carolina.

	Debit	Credit
Cash	$ 593,220
Taxes receivable--current	410,934
Estimated uncollectible current taxes		$ 7,956
Vouchers payable		275,668
Due to Other Funds		322,044
Fund balance--Unassigned		?

The town has five primary governmental functions: General Government, Public Safety, Education, Parks and Recreation, and Public Works. The Towns is about to begin its 2018 fiscal year (FY 2018) set to begin May 1, 2017 and ending April 30, 2018.

Instructions: For eachquestion below, provide the journal entry(ies), explanation, or calculation for each selected transaction below in the space provided. Unless otherwise indicated, each journal entry(ies) should be for the town of Careys General Fund for fiscal year 2018 (FY 2018). No subsidiary journal entries will be required.

4/30/17. Calculate the fund balanceunassigned in the General Fund. Show your computations to receive credit:

5/1/17. ThetownofCareyscitycouncilandmayorapprovedthefiscalyear2018 budget with estimated revenues of $1,460,445; unallotted appropriations totaling $1,523,762; estimated other financing uses for transfers to capital projects fund ($360,000) and transfers to the debt services fund of ($267,000); and, estimated other financing sources of $240,000 (proceeds from a note) and $63,724 (transfers-in from the special revenues fund). Of the unallotted appropriations, approximately $220,000 is provided for General Government, $403,062 for Public Safety, $312,000 for Education, $118,700 for Parks and Recreation, and $470,000 for Public Works.

1. Journalize the adoption of the fiscal year 2018 budget in the general fund (ignore subsidiary ledger entries):

2. Briefly explain if there exists sufficient fund balance to adopt this budget? Is this a deficit budget/surplus budget? (No less than three (3) sentences, supported by calculations to receive credit):

3. On 5/2/17, the town of Carey allotted approximately 20% of the annual appropriations to the various agencies for the beginning of the fiscal year 2018. Journalize the entry in the general fund to record the allocation of the allotment (ignore subsidiary ledger):

5/11/17. Goods ordered in FY 2017 that were outstanding at the end of that fiscal year were received on 5/11/17 in FY 2018. The estimated cost of the goods received on this date was $87,145. The order was entirely for Public Safety. The invoice cost of the goods was $87,188.

1. Journalize the entry to record the receipt of the FY 2017 goods in the general fund in FY 2018:

2. Journalize the entry in the general fund to record the invoice cost of the goods in FY 2018:

5/18/17. $365,000 of the balance in vouchers payable were paid in cash; journalize the payment at the governmental activities (government-wide) level:

6/23/17. Revenues were received in cash totaling $656,210 (comprising of charges for services: $486,000, General Government; $105,900 Public Safety; and $64,310 Parks and Recreation):

1. Journalize the entry to the general fund:

2. Journalize the governmental activities (government-wide) entry:

6/30/17. Collected80%ofthepropertytaxesreceivablethatwereassessedduringthe previous fiscal year (FY 2017) (round to the nearest dollar) (Hint: Look at the Trial Balance at the beginning of the problem).

Journalize the collection of the taxes in the general fund:

7/1/17. Assume the remaining balance of taxes receivable from FY 2017 are delinquent. Journalize the delinquency in the general fund:

7/2/17. The delinquent taxes were immediately assessed interest and penalties totaling $31,290 of which $2,700 are estimated as uncollectible. Journalize the assessed interest and penalties at the governmental activities (government-wide) level:

7/12/17. PurchaseorderswereissuedtoacquirevariousgoodsforFY2018with estimated costs as follows:

Journalize the issuance of the purchase orders in the general fund (ignore subsidiary ledger entries):

7/31/17. The Town of Carey, NC borrowed $80,000 from North Carolina National Bank in anticipation of eventual property tax collections. Interest is 3.25% per annum on the note, remitted when the loan is repaid. The note is expected to be paid back within three months. Journalize the entry to record the proceeds in the general fund:

8/1/17. Annual property taxes for FY 2018 are levied at $540,000, with estimated uncollectible taxesat4%.

1. Calculate the gross property tax levy (round to the nearest dollar):

2. Journalize the FY 2018 property tax levy in the general fund:

General Government	$ 116,500
Public Safety	108,285
Parks and Recreation	77,240
	$ 302,025

8/17/17. Payroll is journalized in the amount of $32,800 with $8,700 in federal tax withholdings ($2,208 of this amount are the employees share of FICA taxes) and $3,490 in NC state tax withholdings. The net pay will go into employees direct deposit on 8/18/17. Journalize the employer payroll accrual in the general fund:

8/18/17. Journalize the payment of the vouchers for the employees net pay in the general fund:

8/19/17. In the general fund, journalize the employers required FICA tax match owed to the federal government from the 8/17/18 payroll (do not credit Vouchers Payable):

8/21/17. Received only part of the 7/12/17 orders were received. Actual costs and estimated costs below of the orders received:

	Actual	Estimated
	Cost	Cost
General Government	$ 101,447	$ 101,360
Public Safety	107,819	107,928
Parks and Recreation	75,266	75,116
	$ 284,532	$ 284,404

1. Journalize the receipt of the order in the general fund:

2. Journalize the actual expenditure and liability in the general fund:

3. Journalize the actual expenditure and liability in the governmental activities (government-wide) journal:

8/24/17. Carey, NC allotted approximately 30% of the remaining balance of annual appropriations to the various agencies. Journalize the entry in the general fund to record the allocation of this second allotment:

8/26/17. Thecityissuedanotewiththeproceedsusedtofinancethecostofacquiring four (4) sanitation trucks, costing $60,000 each.

1. Journalize the 8/26/17 issuance of the note in the general fund:

2. Journalize the 8/26/17 issuance of the note in the governmental activities (government-wide) journal:

8/28/17. Issued a purchase order for the four (4) sanitation trucks. The estimated cost was $60,000 per vehicle. The trucks are custom ordered and will not be received until January, 2018. Journalize the entry in the general fund to record the issuance of the purchase order:

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11/1/17. Carey, NC repaid the tax anticipation note (issued on July 31) in full, including accrued interest. Prepare the journal entry in the governmental activities (government- wide) journal (round to the nearest dollar):

11/15/17. Approximately $44,275 of the delinquent taxes recorded on 7/1/17 from the fiscal year 2017 were deemed uncollectible by the Carey, NC Tax Assessment Board. Interest and penalties of $5,820 are attached to the delinquent taxes. These taxes and associated interest and penalties have been approved for a write-off. Journalize the write- off of these delinquent taxes and the interest and penalties in the general fund:

11/28/17. The Carey, NC city council saw that actual revenues are exceeding earlier estimates by $60,000 due to much improving economic conditions. Therefore, the city council increased estimated revenues by $60,000. In addition, the city council transferred $40,000 of unallotted appropriations from Education to Public Safety to pay for union

pay increases. Journalize the entry in the general fund to record this budget adjustment (ignore subsidiary ledger entries):

12/5/17. Carey, NC was received a $30,000 grant from the U.S. Department of Homeland Security to study local policing issues. A Special Revenues Fund was created (ignore budget adoption). The monies were received in the Special Revenues Fund, and then transferred to the General Fund.

1. The Special Revenues Fund receives the funds from the U.S. Department of Homeland Security. Journalize the receipt of the grant proceeds in the Special Revenues Fund:

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2. The Special Revenues Fund transfers the grant proceeds to the General Fund, where the monies will be spent on the study (in Public Safety). Journalize the entry in the Special Revenues Fund to transfer the monies to the General Fund:

3. In the General Fund, journalize the receipt of the $30,000 from the Special Revenues Fund:

4. Assume Carey, NC spends $22,000 on the study. Journalize the entry in the General Fund to record the expenditure and liability (ignore encumbrances):