Prepare journal entries to record the following transactions and events that occurred in Jeter City during calendar year 2022. 1. The city council adopted the following budget: Adopted budget Estimated revenues and other sources: Property taxes $3,250,000 Sales taxes 1,820,000 Use of fund balance 65,000 Total $5,135,000 Appropriations: Streets and parkways: Personal services $1,014,000 Equipment 123,500 Operating supplies 162,500 All other appropriations 3,835,000 Total $5,135,000 2. The Department of Streets and Parkways (S&P) took bids to purchase several items of equipment. The lowest bid came in at $136,500, which was greater than the amount appropriated for equipment. Jeter City’s budget director, who had the authority to interchange budgetary appropriations amounts within a department, authorized a $13,000 reduction in the department’s personal services appropriation and a corresponding increase in the equipment appropriation. 3. S&P entered into contract S&P 2022a for $136,500, charging the equipment appropriation. 4. S&P issued PO 22-1 for asphalt in the amount of $19,500, charging the operating supplies appropriation. 5. S&P received the equipment, and after inspecting all the items, approved the $136,500 invoice (related to contract in number 3) for payment. 6. S&P received the asphalt and approved the invoice of $19,500 for payment.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Prepare journal entries to record the following transactions and events that occurred in Jeter City during calendar year 2022. 1. The city council adopted the following budget: Adopted budget Estimated revenues and other sources: Property taxes $3,250,000 Sales taxes 1,820,000 Use of fund balance 65,000 Total $5,135,000 Appropriations: Streets and parkways: Personal services $1,014,000 Equipment 123,500 Operating supplies 162,500 All other appropriations 3,835,000 Total $5,135,000 2. The Department of Streets and Parkways (S&P) took bids to purchase several items of equipment. The lowest bid came in at $136,500, which was greater than the amount appropriated for equipment. Jeter City’s budget director, who had the authority to interchange budgetary appropriations amounts within a department, authorized a $13,000 reduction in the department’s personal services appropriation and a corresponding increase in the equipment appropriation. 3. S&P entered into contract S&P 2022a for $136,500, charging the equipment appropriation. 4. S&P issued PO 22-1 for asphalt in the amount of $19,500, charging the operating supplies appropriation. 5. S&P received the equipment, and after inspecting all the items, approved the $136,500 invoice (related to contract in number 3) for payment. 6. S&P received the asphalt and approved the invoice of $19,500 for payment.

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