The City of Soheil maintains its books so as to prepare fund accounting statements and prepares worksheet adjustments in order to prepare government-wide financial statements. Required: You are to prepare, in journal form, worksheet adjustments for each of the following situations. General fixed assets, as of the beginning of the year, which had not been recorded, were as follows: Land $ 96,000,000 Buildings 480,000,000 Improvements other than buildings 270,000,000 Equipment 60,000,000 Accumulated depreciation, capital assets 150,000,000 During the year, expenditures for capital outlays amounted to $22,700,000. Of that amount, $10,600,000 was for buildings; $8,300,000 was for improvements other than buildings, $95,000 was capitalized interest and the remainder was for land. The capital outlay expenditures outlined in (B) were completed at the end of the year (no depreciation until next year). For purposes of financial statement presentation, all capital assets are depreciated using the straight-line method, with no estimated salvage value. Estimated lives are as follows: buildings, 48 years; improvements other than buildings, 18 years; equipment, 12 years. Equipment with a cost of $170,000 and accumulated depreciation at the time of sale of $100,000 was sold for $80,000.

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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The City of Soheil maintains its books so as to prepare fund accounting statements and prepares worksheet adjustments in order to prepare government-wide financial statements. Required: You are to prepare, in journal form, worksheet adjustments for each of the following situations.

General fixed assets, as of the beginning of the year, which had not been recorded, were as follows:

Land	$ 96,000,000
Buildings	480,000,000
Improvements other than buildings	270,000,000
Equipment	60,000,000
Accumulated depreciation, capital assets	150,000,000

During the year, expenditures for capital outlays amounted to $22,700,000. Of that amount, $10,600,000 was for buildings; $8,300,000 was for improvements other than buildings, $95,000 was capitalized interest and the remainder was for land.

The capital outlay expenditures outlined in (B) were completed at the end of the year (no depreciation until next year). For purposes of financial statement presentation, all capital assets are depreciated using the straight-line method, with no estimated salvage value. Estimated lives are as follows: buildings, 48 years; improvements other than buildings, 18 years; equipment, 12 years.

Equipment with a cost of $170,000 and accumulated depreciation at the time of sale of $100,000 was sold for $80,000.

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