Question

On January 1, 2017, the first day of its fiscal year, Carter City received notification that a federal grant in the amount of $580,000 was approved. The grant was restricted for the payment of wages to teenagers for summer employment. The terms of the grant permitted reimbursement only after qualified expenditures have been made; the grant could be used over a two-year period. The following data pertain to operations of the SUMMER EMPLOYMENT GRANT FUND, a special revenue fund of Carter City, during the year ended December 31, 2017.

1. The budget was recorded. It provided for Estimated Revenues for the year in the amount of $290,000, and for Appropriations in the amount of $290,000.
2. A temporary loan of $290,000 was received from the General Fund.
3. During the year, teenagers earned and were paid $278,200 under terms of the Summer Employment program. An additional $9,000 is accrued as payable on December 31. Recognize the receivable and revenue (include the $9,000 of wages payable).
4. Each month a properly documented request for reimbursement was sent to the federal government; checks for $283,000 were received.
5. $256,200 was repaid to the General Fund.
6. Necessary closing entries were made.

Prepare the journal entry for the year ended December 31 of the Summer Employment Grant Fund.

Answer 1

S. No.	Account Titles and Explanation	Debit $	Credit $
1	Estimated Revenue Control	290000
	Appropriation Control		290000
	To Record Estimated Revenue
2	Cash	290000
	Due to General Fund		290000
	To Reccord Entry For Loan Received		-
3.a.	Expendture Control	287200
	Cash		278200
	Accrued Wages Payable		9000
	To Record Payment Under Sumer Empoyment Programme
3.a.	Grant Receivable	287200
	Revenue Control		287200
	To Record Entry for Grant Receivable
4	Cash	283000
	Grant Receivable		283000
	To Record Grant Received
5	General Fund	256200
	Cash		256200
	To Record Entry for repayment to general Fund
6	Appropriation Control	290000
	Estimate Revenue Control		290000
	To Record Closing Entry
6.b.	Revenue Control	287200
	Unreserved fund Balance		287200
	To Record Closing Entry