Rural County is an agricultural community located hundreds of miles from any metropolitan center. The County established a Television Reception Improvement Fund to serve the public interest by constructing and operating television translator stations. TV translator stations serve communities that cannot receive the signals of free over-the-air TV stations because they are too far away from a broadcasting TV station. Because of the large distances between customers, commercial cable TV providers are also not inclined to serve rural communities. The fund charges TV owners a monthly fee of $15. The fund was established on December 20, 2019, with a transfer of cash from the General Fund of $125,000. On December 31, 2019, the fund acquired land for its translator stations in the amount of $40,000. The remaining cash and the land are the only resources held by the fund at the beginning of 2020.

1. Other than beginning account balances, no entries have been made in the general ledger.

2. The County prepared a budget for 2020 with estimated customer fees of $32,000, operating costs of $28,000, capital costs of $66,000, and estimated loan proceeds of $55,000.

3. The following information was taken from the checkbook for the year ended December 31, 2020:

   	Cash Basis 12 months
   Cash Receipts:
   Fees from customers	$35,100
   Borrowing from bank	52,000
   Total deposits	87,100
   Cash Disbursements:
   Supplies	7,300
   Labor	12,000
   Utilities	7,500
   Equipment	64,000
   Interest on bank note	2,080
   Total checks	92,880
   Beginning Cash Balance	85,000
   Ending Cash Balance	$79,220

4. Page 179The loan from the bank is dated April 1 and is for a five-year period. Interest (8 percent annual rate) is paid on October 1 and April 1 of each year, beginning October 1, 2020. The County has elected not to establish a debt service fund but will pay the interest on this note from the Television Reception Improvement Fund.

5. The machinery was purchased on April 1 with the proceeds provided by the bank loan and has an estimated useful life of 10 years (straight-line basis).

6. In January 2021, customers remitted fees totaling $2,850 for December service.

7. Supplies of $750 were received on December 29 and paid in January 2021.

8. Unused supplies on hand amounted to $760 at December 31, 2020.

9. Utilities are paid in the following month. The utility bill for December 2020 was received on January 4, 2021 in the amount of $550. (Utility bills are recorded through accounts payable.)

10. On December 21, the company placed an order for a new computerized control switch in the amount of $1,500 to be delivered and paid in January 2021.

Part 2: Assume the County chooses to report the Television Reception Improvement Fund as an enterprise fund following accrual basis statements. Using the Excel template provided,

1. Prepare journal entries recording the events above for the year ending December 31, 2020.

2. Post the journal entries to T-accounts.

3. Prepare closing entries.

4. Prepare a Statement of Revenues, Expenses, and Changes in Fund Net Position.Page 180

5. Prepare a Statement of Net Position, assuming the bank note is related to capital asset acquisitions.