The State of Monogahela adopted a budget for its general fund for the year. The following amounts are relevant:

Estimated total sales taxes to be collected$100,000,000

Estimated total to be spent92,000,000

Amount authorized for retirement of debt1,000,000

Amount authorized to subsidize state agency telecommunications1,000,000

At the end of the fiscal year, $8.4 million in encumbrances were outstanding, but the appropriation authority expired.

1. Purchase orders in the amount of $15 million are issued in the general fund.

2. The merchandise for which the purchase orders were issued is received.

3. The annual budget is closed out at year end.

4. Encumbrances to lapse.