The City of Kent established a self-supporting department a fewyears ago to centralize purchasefor the government. The mission is to reduce costs and avoid duplication of efforts. All costs will be recovered through user fees, but any excess of fees over expenses should be less than 4 percent. The preclosing trial balance for the IT department as of last year, is shown below.

DebitsCredits(in thousands)Cash$14,600Due from Other Funds4,730Materials and Supplies Inventory410Machinery and Equipment54,700Accumulated Depreciation$31,000Accounts Payable2,690Due to Federal Government2,740Due to Other Funds1,210Net PositionNet Investment in Capital Assets23,700Net PositionUnrestricted13,100$74,440$74,440

During the current fiscal year ended December 31, the following transactions (summarized in thousands of dollars) occurred:

1. Gross employee wages were $60,600, including the employer's share of social security taxes amounting to $4,310. Federal income and social security taxes withheld from that amount totaled $19,700.
2. Office expenses in the amount of $3,910 were paid in cash.
3. Materials and supplies purchased on account during the year were $8,880.
4. A bill totaling $15,350 was received for utilities provided by Washington City's utility fund.
5. Cash paid to the federal government for payroll taxes was $24,200.
6. Cash paid to the Utility Fund was $14,600.
7. Accounts payable at year-end totaled $3,090. Prepare the adjusting entry related to accounts payable.
8. Materials and supplies used during the year were $8,660.Prepare the adjusting entry related to materials and supplies.
9. Charges to departments during the fiscal year were as follows. Prepare the adjusting entry related to charges to departments.

General Fund$60,300Special Revenue Fund21,400

10. Unpaid balances at year-end were.Prepare the adjusting entry related to due from other funds.

General Fund$3,600Special Revenue Fund1,900

11. The depreciation for the year was $5,800.

12. Revenue and expense accounts for the year were closed.

Required

1. a-1.Prepare journal entries for the Information Technology Fund for the current year ended December 31.(If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in thousands of dollars.)

1. a-2.Prepare closing entry for the Information Technology Fund for the current year ended December 31.(If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in thousands of dollars.)

Record the closure of revenue and expense accounts.

Record the operating loss for the year.

Record the transfer of depreciation expense to the asset account.

a-3.Prepare statement of revenues, expenses, and changes in net position for the Information Technology Fund for the current year ended December 31.(Enter your answers in thousands of dollars.)

1. Prepare a statement of net position for the Information Technology Fund as of December 31.(Enter your answers in thousands of dollars.)

1. Prepare a statement of cash flows for the Information Technology Fund for the current year ended December 31.(Negative amounts should be indicated by a minus sign. Enter your answers in thousands of dollars.)

Has the manager of the IT department been able to achieve the goal of recovering costs through user fees?

multiple choice

• Yes
• No