Question

Relationship between budgetary fund balance and actual fund balance The Village of Albert’s Alley recorded the following budgetary journal entry at the beginning of fiscal 2019: Estimated revenue 5,000,000 Appropriations 4,950,000 Budgetary fund balance 50,000 At the end of fiscal 2019, what would be the effect on the ending actual fund balance, assuming the following: a. Actual revenues are equal to estimated revenues, and actual expenditures are $7,000 less than appropriations. b. Actual revenues are equal to estimated revenues, and actual expenditures are equal to appropriations. c. Actual revenues exceed estimated revenues by $4,000, and actual expenditures are equal to appropriations. d. Actual revenues are $3,000 less than estimated revenues, and actual expenditures are $2,000 less than appropriations. NOTE: If there is no effect on the actual fund balance, leave Amount blank (zero) and select "N/A" as your answer.

Answer 1

Solution :-

Given data :

Estimated revenue = 5,000,000

Appropriations = 4,950,000

Budgetary fund balance = 50,000

Here we need to find out that, what would be the effect on the ending actual fund balance, assuming the given conditions, At the end of fiscal 2019.

( a ) :-

Particulars	Amount
Budgetary fund balance	$50,000
Actual expenditures	$7,000
At the end of fiscal 2019, Budgetary Fund Balance	= 50,000 + 7,000 = $57,000

( b ) :-

Particulars	Amount
Budgetary fund balance	$50,000
Actual expenditures	$0
At the end of fiscal 2019, Budgetary Fund Balance	= 50,000 + 0 = $50,000

( c ) :-

Particulars	Amount
Budgetary fund balance	$50,000
exceed estimated revenues	$4,000
Actual expenditures	$0
At the end of fiscal 2019, Budgetary Fund Balance	= 50,000 + 4,000 = $54,000

( d ) :-

Particulars	Amount
Budgetary fund balance	$50,000
Actual revenues $3,000	$3,000
Actual expenditures	$2,000
At the end of fiscal 2019, Budgetary Fund Balance	= 50,000 - 3,000 + 2,000 = $49,000