Question

The City of Mocksville had the following pre-closing account balances in its General Fund as of April 30, 2020. Debits and credits are not separated; each account had its “normal” balance. Among the expenditures recorded this year is an amount expended on supplies ordered at the end of the previous year. Assume that encumbrances do not lapse and that the City failed to make the journal entry(s) necessary to re-establish the encumbrance in the current year.

Required:

(a) Prepare all entries necessary to close the General Fund of the City of Statesville.

(b) Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the General Fund for the City of Statesville for the Year Ended April 30, 2020. End with the ending fund balance. This is the GAAP operating statement.

Cash Estimated Revenues Control Revenues Control Appropriations Control Estimated Other Financing Sources Control Other Financing Uses Control-Transfers Out Expenditures Control Taxes Receivable-Delinquent Fund Balance-Unassigned 5/1/19 Estimated Other Financing Uses Control Vouchers Payable Encumbrances Control Budgetary Fund Balance -- Reserve for Encumbrances Other Financing Sources Control-Transfers In

$    250,000 6,000,000 6,100,000 5,750,000 250,000 500,000 5,300,000 140,000 500,000 500,000 165,000 200,000 240,000 235,000

Answer 1

Journal Entry :
	Debit	Credit
Appropriations Control	$                                    5,750,000
Estimated Other Financing Uses Control	$                                       500,000
Estimated Revenues Control		$           6,000,000
Estimated Other Financing Sources Control		$              250,000
Budgetary Fund Balance -- Reserve for Encumbrances	$ 200,000
Encumbrances Control		$           200,000
Revenues Control	$                                    6,100,000
Other Financing Sources Control-Transfers In	$                                       235,000
Expenditures Control		$           5,300,000
Other Financing Uses Control-Transfers Out		$              500,000
Fund Balance		$              535,000

Statement of Revenues, Expenditures, and Changes in Fund Balance

Revenues		6,100,000
Expenditures		5,300,000
Excess of Revenue over Expenditure		800,000
Other Financing Sources (Uses):
Transfer In	235,000
Transfer out	(500,000)	(265,000)
Excess of Revenue and other financing Sources		535,000
Over Expenditures and Other Financing Uses
Fund Balance - May 1, 2019		500,000
Fund Balance - April 30, 2020		1,035,000

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