The following information is available concerning general fund activities of the City of Middletown for the year 2014. Middletown uses the GAAP budgetary basis to account for encumbrances.
The general fund budget for 2014 consisted of the following items:
Estimated property tax revenues$8,500,000
Appropriations 8,800,000
Transfers to capital projects fund 200,000
Transfers to enterprise fund 50,000
Estimated bond proceeds 500,000
2. $78,000 in encumbrances were outstanding at the end of 2013.
3. Current property tax revenues of $8,500,000 were accrued at the beginning of the year, along with a current uncollectible portion of $100,000. The general fund reported equal balances of $25,000 in its delinquent property taxes receivable and uncollectible allowance accounts at the beginning of the year.
4. At the end of the year, current property tax receivables of $120,000 remained uncollected. The current uncollectible accounts balance was $40,000. Delinquent property taxes of $15,000 were collected during the year. The remaining delinquent balances were written off at the end of the year. The general fund's policy is to fully reserve any remaining current property taxes receivable and reclassify them as delinquent.
5. General obligation bonds with a face value of $500,000 were issued at par. Interest at 4% of principal and $20,000 of principal are due annually in 2015. These bonds will be used to finance a community project, which is reported in the general fund. Principal payments will be handled through the debt service fund, but interest payments will be paid through the general fund.
6. The general fund sold equipment with an original cost of $40,000 for $6,000, and purchased a building for $200,000 during 2014. Equipment with an original cost of $30,000 was retired during the year.
7. The transfers to the capital projects and enterprise funds were made as budgeted.
8. Actual expenditures (including the building purchase) for the year were $8,720,000, of which $80,000 related to encumbrances outstanding at the beginning of the year. Encumbrances outstanding at year-end were $130,000.
Required
Answer the following questions related to Middletown's general fund activities for 2014.
a. Present the beginning of 2014 budget and encumbrance entries. What is their net impact on fund balance-unassigned?
b. What is total property tax revenue for 2014? How much cash was collected from property taxes in 2014?
c. How much in bond interest payable should be shown on the general fund's year-end balance sheet?
d. Prepare the end of 2014 closing entries for the general fund.
e. Present a general fund budgetary comparison schedule for 2014.