Question

The City of Saltwater Beach established an enterprise fund in 2015 to construct and operate Tribute Aquatic Center, a public swimming pool. The pool was completed and began operations in 2016. All costs, including repayment of debt, are to be paid by user fees. The fund’s pre-closing trial balance as of December 31, 2017 is shown below.

		Debits				Credits
Cash and Cash Equivalents		$	182,640
Accounts Receivable			5,240
Supplies			8,250
Restricted Cash and Cash Equivalents			944,860
Land			1,404,250
Buildings and Equipment			927,810
Accumulated Depreciation—Buildings and Equipment						$	41,750
Improvements Other Than Buildings			4,729,160
Accumulated Depreciation—Improvements Other Than Buildings							212,810
Accounts and Accrued Payables							22,210
Current Portion of Long-Term Debt—Bonds							282,370
Bonds Payable							6,212,140
Net Position—Net Investment in Capital Assets							174,490
Net Position—Restricted							869,390
Net Position—Unrestricted							84,260
Charges for Services							2,045,580
Interest and Dividend Income							92,750
Personnel Expenses			1,036,800
Utilities Expense			189,010
Repairs and Maintenance			82,320
Supplies Expense			67,380
Depreciation Expense			137,330
Interest Expense			322,700
		$	10,037,750			$	10,037,750

Additional information concerning the Tribute Aquatic Center Fund follows.
1.	All bonds payable were used to acquire property, plant, and equipment.
2.	Each year a payment is required on January 1 to retire an equal portion of the bonds payable. The payment for the current year was paid on January 1, 2017.
3.	Equipment was sold for cash at its carrying value of $9,270.
4.	Total cash received from customers was $2,042,720 and cash received for interest and dividends was $92,750; of this amount $75,470 was restricted cash. There were no other changes to restricted cash during the year.
5.	Cash payments included $1,041,020 for personnel expenses, $186,200 for utilities, $86,420 for repairs and maintenance, $322,700 for interest on bonds, and $66,040 for supplies.
6.	The beginning balance in Cash was $98,120, Accounts Receivable was $3,170, Supplies was $9,560 and Accounts and Accrued Payables was $28,480. Accrued Payables include personnel expenses, utilities, and repairs and maintenance.
7.	The net position categories shown on the pre-closing trial balance have not been updated to reflect correct balances as of the December 31, 2017 year end.

Required

2.

Required information

a.	Prepare the statement of revenues, expenses and changes in fund net position for the Tribute Aquatic Center as of December 31, 2017. (Negative amounts should be indicated by a minus sign.)

      

3.

Required information

b.	Prepare the statement of net position for the Tribute Aquatic Center as of December 31, 2017.

      

Answer 1

Part A

Statement of revenues, expenses and changes in fund net position for the Tribute Aquatic Center

December 31, 2017

Operating income :
Charges for services		2045580
Operating expenses :
Personnel expense	1036800
Utilities expense	189010
Repairs and maintenance expense	82320
Supplies expense	67380
Depreciation expense	137330
Total operating expense		(1512840)
Operating income		532740
Non operating revenue /expense
Interest income	92750
Interest expense	(322700)
Total non operating income (expense)		(229250)
Change in net position		302790
Net position, January 1		1128140
Net position, December 31		1430930

Part B

Statement of Net position

Assets:
Current assets:
Cash and cash equivalents		182640
Accounts receivable		5240
Supplies		8250
Total current assets			196130
Restricted cash and cash equivalents			944860
Capital assets :
Land		1404250
Building and equipment	927810
Less: allowance for depreciation	(41750)	886060
Improvements other than building	4729160
Less: allowance for depreciation	(212810)	4516350
Total capital assets			6806660
Total assets			7947650
Liabilities:
Current liabilities :
Accounts and accrued payables		22210
Current portfolio of long term debt		282370
Total current liabilities			304580
Non current liabilities
Bonds payable			6212140
Total liabilities			6516720
Net position :
Net investment in capital assets		477280
Restricted		869390
Unrestricted		84260
Total net position			1430930