A city has a solid waste landfill that was filled 12 percent in Year 1 and 26 percent in Year 2. During those periods, the government expected that total closure costs would be $2 million. As a result, it paid $50,000 to an environmental company on July 1 of each of these two years. Such payments will continue for several years to come. Indicate whether each of the following independent state-ments is true or false and briefly explain each answer. The city has a December 31 year-end.a. The government-wide financial statements will show a $230,000 expense in Year 2 but only if reported in an enterprise fund.b. The fund financial statements will show a $50,000 liability in Year 2 if this landfill is reported in the general fund.c. The fund financial statements will show a $50,000 liability at the end of Year 2 if this landfill is reported in an enterprise fund.d. If this landfill is reported in an enterprise fund, the government-wide financial statements and the fund financial statements will basically have the same reporting.e. The government-wide financial statements will show a $420,000 liability at the end of Year 2.f. Over the landfill’s entire life, the amount of expense recognized in the government-wide financial statements will be the same as the amount of expenditures recognized in the fund financial statements. Assume the landfill is reported in the general fund.
A city has a solid waste landfill that was filled 12 percent in Year 1 and 26 percent in Year 2. During those periods, the government expected that total closure costs would be $2 million. As a result, it paid $50,000 to an environmental company on July 1 of each of these two years. Such payments will continue for several years to come. Indicate whether each of the following independent state-
ments is true or false and briefly explain each answer. The city has a December 31 year-end.
a. The government-wide financial statements will show a $230,000 expense in Year 2 but only if
reported in an enterprise fund.
b. The fund financial statements will show a $50,000 liability in Year 2 if this landfill is reported in the general fund.
c. The fund financial statements will show a $50,000 liability at the end of Year 2 if this landfill is reported in an enterprise fund.
d. If this landfill is reported in an enterprise fund, the government-wide financial statements and the fund financial statements will basically have the same reporting.
e. The government-wide financial statements will show a $420,000 liability at the end of Year 2.
f. Over the landfill’s entire life, the amount of expense recognized in the government-wide financial statements will be the same as the amount of expenditures recognized in the fund financial statements. Assume the landfill is reported in the general fund.
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