Question

A local government has the following transactions during the current fiscal period.

1. The budget for the police department, ambulance service, and other ongoing activities is passed. Funding is from property taxes, transfers, and bond proceeds. All monetary outflows will be for expenses and fixed assets. A deficit is projected.

2. A bond is issued at face value to fund the construction of a new municipal building.

3. A computer is ordered for the tax department.

4. The computer is received.

5. The invoice for the computer is paid.

6. The city council agrees to transfer money from the General Fund as partial payment for a special assessments project but has not yet done so. The city will be secondarily liable for any money borrowed for this work.

7. The city council creates a motor pool to service all government vehicles. Money is transferred from the general fund to permanently finance this facility.

8. Property taxes are levied. Although officials believe that most of these taxes should be collected during the current period, a small percentage is estimated to be uncollectible.

9. The city collects grant money from the state that must be spent as a supplement to the salaries of the police force. No entry has been recorded. Appropriate payment of the supplement is viewed as an eligibility requirement.

10. A portion of the grant money in (i) is properly spent.

A. For the transactions indicate in the table below what accounts will be debited and credited for fund financial statements.

B. For the transactions indicate in the table below what accounts will be debited and credited for government-wide financial statements.

Answer 1

Part A

no	Fund type	debited	credited
1	General Fund
		Estimated Revenues
		Estimated Other Financing Sources
			(Budgetary) Fund Balance
			Appropriations
2.	Capital Projects Fund
		Cash
			Other Financing Sources—Bond Proceeds
3	General Fund
		Encumbrances - Computer
			Encumbrances Outstanding
4.	General Fund
		Encumbrances Outstanding
			Encumbrances - Computer
		Expenditures - Computer
			Vouchers Payable
5.	General Fund
		Vouchers Payable
			cash
6.	General Fund
		Other Financing Uses—Transfers Out—Capital Projects
			Due to Capital Projects Fund (Special Assessment)
	Capital Projects Fund
		Due from General Fund
			Other Financing Sources—Transfers In—General Fund
7.	General Fund
		Other Financing Uses—Transfers Out—Motor Pool
		Cash
	Internal Service Fund
		Cash
			Contributed Capital
8.	General Fund
		Property Taxes Receivable
			Revenues—Property Taxes
			Allowance for Uncollectible Taxes
9.	Special Revenue Fund
		cash
			Grant Revenue Collected in Advance
10.	Special Revenue Fund
		Expenditures—Salaries
			Cash
		Grant Revenue Collected in Advance
			Revenues—Grant

Part B

	debited	Credited
1	No entry
2.	Cash
		Bonds payable
3.	No entry
4.	Equipment
		Vouchers Payable
5.	Vouchers Payable
		cash
6.	No entry
7.	No entry
8.	Property Taxes Receivable
		Revenues—Property Taxes
		Allowance for Uncollectible Taxes
9.	Cash
		Grant Revenue Collected in Advance
10.	Expense—Public Safety
		cash
	Grant Revenue Collected in Advance
		Revenue