Chapter 3, Problem 7E

(General Ledger—Subsidiary Ledgers Relationship, Closing Entries, Budgetary Statement) The Eastover City Council adopted the following budget for its General Fund for 20X8. The budget was not revised during the fiscal year. The budgetary basis was modified accrual.

The preclosing trial balances of the Revenues and Expenditures Subsidiary Ledgers at the end of fiscal year 20X8 are:

The only encumbrances outstanding at year end were for $75,000 of unperformed contracts for the Health and Sanitation function. The beginning total fund balance was $312,000.

1. a. Prepare closing entries for both the General Ledger accounts and the subsidiary ledgers of the City of Eastover General Fund. (Hint: You will have to derive the General Ledger balances of some accounts.)
2. b. Prepare the Statement of Revenues, Expenditures, and Changes in Fund Balance—Budget and Actual for the General Fund of the City of Eastover for fiscal year 20X8.