The City of Batavia ordered new computer equipment for $22,000 on November 3, 20X2. The equipment had not been received by December 31, 20X2, Batavia's fiscal year-end. Required: a. Assume that the city has a policy that outstanding encumbrances lapse at year-end. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) k ht (1) Prepare the entry to record the encumbrance on November 3, 20X2. (2) Prepare the entries required on December 31, 20X2. (3) Assuming that the city council accepts outstanding encumbrances in its budget for the next fiscal period (20X3), prepare entries on January 1, 20X3. (4) Prepare entries on January 18, 20X3, when the equipment was received with an invoice cost of $22,550 and accepted by the city. (5) Prepare the entry on December 31, 20X3, to close the expenditures account. -nces View transaction list X the outstanding encumbrances at year-end in 20X2. > 4 Record the entry to reverse the prior-year encumbrance reserve in 20X3. 5 Record the entry to establish the budgetary control over the encumbrances renewed from the prior year in 20X3. ---- .LT the outstanding encumbrances at year-end in 20X2. > 4 Record the entry to reverse the prior-year encumbrance reserve in 20X3. 5 Record the entry to establish the budgetary control over the encumbrances renewed from the prior year in 20X3. ok 6 Record the entry to remove the budgetary reserve for the goods received in 20X3. t Credit nces 7 Record the expenditure for the goods received at the actual cost in 20X3. 8 Record the entry to close the 20/3 expenditures account. Note : journal entry has been entered Record entry Clear entry View general journal b. Assume the city's policy is that outstanding encumbrances are nonlapsing. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) (1) Prepare the entry to record the encumbrance on November 3, 20X2. (2) Prepare the entries required on December 31, 20X2. (3) Prepare the entry on January 1, 20X3, to classify the expenditure in 20X2, the year the encumbrance was initiated. (4) Prepare the entry on January 18, 20X3, when the equipment was received for $22,550. The City Council approved the additional $550 equipment cost as an addition to 20X3's expenditures. (5) Prepare the entries on December 31, 20X3, to close the expenditures accounts. View transaction list 3 > Record the entry to reserve the fund balance for the outstanding encumbrances in 20X2. 4 Record the entry to reclassify the reserve from the prior year, 20X2, in the current year, 20X3. h 5 Record the actual expenditure for the goods received in 20X3. lebit Credit 6 Record the entry to close the expenditures account for mhmnono in sovs hanrinn 3 > Record the entry to reserve the fund balance for the outstanding encumbrances in 20X2. 4 Record the entry to reclassify the reserve from the prior year, 20X2, in the current year, 20X3. 5 Record the actual expenditure for the goods received in 20X3. Vebit Credit 6 Record the entry to close the expenditures account for the prior-year encumbrances in 20X3. 7 Record the entry to close the expenditures for the current year, 20X3. Note : journal entry has been entered Record entry Clear entry View general journal c. Now assume the city has a policy that outstanding encumbrances are nonlapsing, but the 20X3 City Council decided, during its budget hearings for 20X3, not to accept the encumbrance for the computer equipment that had been ordered on November 3, 20X2. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) (1) Prepare the entry required on January 1, 20X3, to cancel the encumbrance reserve for the equipment ordered on November 3, 20X2.