Chapter 9, Problem 18EP

To determine

Prepare necessary journal entries to properly record each transaction for the fiscal year ended December 31, 2017.

Explanation of Solution

Government-wide financial statement: This statement provides a combined summary of the net position and the changes in the net position of the government.

Fund financial statement: The fund financial statement provides detail financial information on the governmental, proprietary and fiduciary activities of the primary government.

Prepare necessary journal entries to properly record each transaction for the fiscal year ended December 31, 2017.

Transaction  Number	Fund or Activity	Account Title	Debit ($)	Credit ($)
1.	GF	Estimated Revenues	2,000,000
		Appropriations		1,990,000
		Budgetary fund balance		10,000
		(To record the general fund receipt)
2.	GF	Taxes receivable-current	1,940,000
		Allowance for uncollectible current taxes		9,000
		Revenues		1,931,000
		(To record the  property tax levy and uncollectible portion)
	GA	Taxes receivable- Current	1,940,000
		Allowance for uncollectible current taxes		9,000
		General revenues-property taxes		1,931,000
		(To record the amount of property tax and amount of general revenue)
3.	GF	Interfund transfers out	25,000
		Cash		25,000
		(To record the general fund transfer)
	ISF	Cash	25,000
		Equipment	300,000
		Accumulated Depreciation		65,000
		Interfund Transfer In		260,000
		(To record the inter-fund  Transfer In)
4.	PF	Investment –marketable securities	800,000
		Revenues-contributions for endowment		800,000
		(To record  the donated marketable security)
		Cash	40,000
		Revenues –Investment earnings		40,000
		(To record  the revenue at the end)
	PF	Interfund Transfer Out	40,000
		Cash		40,000
		(To record the Inter-fund  Transfer Out)
	SRF	Cash	40,000
		Interfund Transfers In		40,000
		(To record the Inter-fund  Transfer In)
	GA	Investment –marketable securities	800,000
		General revenues-contributions for endowment		800,000
		(To record marketable securities and general revenues)
		Cash	40,000
		Programs revenues-culture and recreation- operating grants and  contributions		40,000
		(To record the donation made on culture and creation)
5.	EF	Due from other funds	125,000
		Charges for services		125,000
		(To record the general fund for sewage and water services)
		Cash	124,000
		Due from other  funds		124,000
		(To record the  amount paid)
	GF	Expenditures	125,000
		Due from other funds		125,000
		(To  record the actual due amount)
		Due from other funds	124,000
		Cash		124,000
		(To  record the funds due to other funds)
	GA	Expense-general government	125,000
		Internal balances		125,000
		(To record  the  internal balance)
		Internal balances	124,000
		Cash		124,000
		(To record the cash settlement)
6.	ISF & GA	Inventory of supplies	4,500
		Cash		4,500
		(To record the purchase of  central duplicating fund)
7.	GF	Cash	1,988,000
		Taxes receivable-current		1,925,000
		Revenues		63,000
		(To record the cash collection)
	GA	Cash	1,988,000
		Taxes receivable-current		1,925,000
		Program revenue-general government-charges for services		63,000
		(To record the cash collection)
8.	ISF	Due from other funds	23,800
		Billings to departments		23,800
		(To record the total funds due from department)
	EF	Expense-administrative	8,100
		Due to other funds		8,100
		(To  record the City’s utility fund)
	GF	Expenditures-General government	15,700
		Due to other funds		15,700
		(To record  the  internal service fund)
	GA	Internal balances	8,100
		Program revenues-general government-charges for services		8,100
		(To  record  the  government charges for service)
9.	CPF	Cash	5,000,000
		Proceeds  of bonds		5,000,000
		(To record the sale of  bond)
		Encumbrance	4,500,000
		Encumbrances outstanding		4,500,000
		(To  record the amount of contract)
	GA	Cash	5,000,000
		Bond payable		5,000,000
		(To record the  cash receipt on bond)
10.	GF	Encumbrance	32,000
		Encumbrances outstanding		32,000
		(To record the issue of purchase order)
		Encumbrance Outstanding	32,000
		Expenditures	31,900
		Encumbrances		32,000
		Cash		31,900
		(To record the  cash payment  of purchase)
	GA	Equipment	31,900
		Cash		31,900
		(To record the purchase of  equipment  on cash)

(Table 1)