Reconciliations required to yield government-wide financial statements from fund financial statements and preparation of financial statements The City of Rowan is preparing its government-wide financial statements for the year. Its accountant must prepare a number of journal entries to recognize assets and liabilities previously omitted from the fund financial statements and to recognize revenues and expenses for the year under accrual accounting that were not recognized under the current financial resources measurement focus and the modified accrual basis of accounting used to prepare the Statement of Revenues, Expenditures, and Changes in Fund Balances for its funds. a. Prepare the journal entries for the required reconciliations to recognize the following in the government-wide financial statements (all amounts in $1,000s): 1. Recognize Capital Assets of $210,630 as of the beginning of the year. Reconciliation Spreadsheet Description Debit Credit Capital assets, net 210,630 0 Net position 0 210,630 2. Record Depreciation Expense of $8,699 for the year and reverse Expenditures of $11,962 for Capital Outlays during the year. Depreciation expense 8,699 0 Capital assets, net 3,263 0 Expenditures--capital outlay 11,962 3. Recognize $9,000 of Bonds Payable as of the beginning of the year. Net position 9,000 ~ 0 Bondspayable A 0 9,000 4. Reverse Other Financing Sources of $2,000 and Expenditures - Debt Payments of $700 relating to increases and decreases in the bond liability during the year. Other financing sources--proceeds from bonds 2,000 0 Bondpayable 0 1,300 Expenditures--debt principal payments 0 700 5. Reverse Deferred Revenue of $27,300 as of the beginning of the year. Deferred revenues 27,300 0 Net position 0 27,300 6. Reverse $1,365 of Deferred Revenue recognized during the year. Deferred revenues 1,365 07 Revenues 0 1,365 7. Recognize Compensated Absences of $3,988 as of the beginning of the year and an increase in that liability of $199 during the year. Net position 3,988 0 Compensated absences expense 199 0 Compensated absences 0 4,187 8. Recognize $20 of Accrued Interest Payable as of the beginning of the year and an increase in that liability of $33 during the year. Net position 20 Interest expense 33 07 Accrued interest 0 53 9. Recognize a liability of $5,482 relating to the City's landfill as of the beginning of the year. The estimate for this liability did not change during the year. 5,482 0 Net position Landfill closure and post-closure care costs 0 5,482 b. The City of Rowan reports the following summary fund financial statements for its General Fund: b. The City of Rowan reports the following summary fund financial statements for its General Fund: Balance Sheet General Fund Current: Cash $32,400 Receivables: Real estate and 2,520 personal property Intergovernmental 26,060 $60,980 Total assets $2,982 28,665 Payables Deferred revenues Total liabilities Fund balance- unassigned 31,647 29,333 $60,980 Statement of revenues expenditures, and changes in fund halances: Total Total revenues- financial terte $111,384 Total expenditures Other financing 107,912 sources and uses: Proceeds from bonds 2,000 Net change in fund balances $5,472 Given these fund financial statements and the reconciliations in Part a, prepare the government-wide Statement of Net Position and identify the Revenues, Expenses and Change in Net Position that should be reported in the Statement of Activities for the year. HINT: Use a negative sign with your answers in the adjusted "Governmental Activities" column to indicate any reductions. Gov't Elimination Entries Governmental Statement of Net Position Activities Dr Cr Activities Assets Current- Cash $32,400 $ 32,400 Receivables: Real estate and personal property 2,520 2,520 Intergovernmental 26,060 26,060 Noncurrent: Receivables: Capital assets, net of accumulated depreciation a.1. Ox OX a.2. Ox Total assets $60.980 $ OX Liabilities Current $2,982 $ Ox Payables Accrued interest 0 x a.8. 0 OX Bond and notes payable O x a.3 OX OX a.4. Compensated absences 0 x a.7. OX Landfill closure and post-closure care costs 0X a.9 OX Deferred revenues 28,665 a.5. OX a.6. 0x Total liabilities 31,647 0 x Net position: Fund balance 29,333 Ox Adjustments: a.3. Ox O x a. 1. OX a.7. OX 0X a.5. OX a.8. OX Ox a.9 OX OX below OX 0X Net income adjustments Net position OX Check: Liabilities + Net position = Total assets $ OX Adjustments: a.3. OX 0X a.1. a.7. 0X 0X a.5. OX a.8. 0x 0X a.9. 0 x 0X Net income adjustments below OX 0 x 0 X Net position Check: Liabilities + Net position = Total assets $ OX Gov't Elimination Entries Governmental Statement of Revenues, Expenditures, and Changes in Fund Balances Activities Dr Cr Activities Total revenues --fund financial statements $ 0 x $ 0X Adjustments: Deferred revenues 0X a.6. 0 x Total revenues --statement of activities Total expenditures --fund statements OX OX Adjustments: Debt principal payments 0X a.4. OX Depreciation expense/capital outlay a.2. 0X 0X a.2. Compensated absences a.7. OX 0 X Interest expense a.8. OX 0X Total expenses --statement of activities OX Miscellaneous adjustments: OFS --Proceeds from bonds 0X a.4. O Net change in fund balances/Change in Net Position $ OX 0 x OX $ OX