Jefferson County operates a centeralized motor pool to service county vehicles. At the endof 2019, the motor pool Internal Service Fund had the following account balances: Debits: Due from General Fund $7,000; Cash $17,500; Capital assests $35,000; Supplies $4,000 Total $63,500. Credits: Accounts Payable $5,500; Accured Waged Payable $300; Accumulated Depreciation $6,500; Advance from Enterprise Fund $25,000; Net Position $26,200; Total $63,500. The following Journal Entries took place in 2020: Jefferson County Internal Service Fund Journal Entries December 31, 2020 Account Title Debits Credits 1 Inventory of Supplies 37,500 Accounts Payable 37,500 2 Due from Other Funds 96,000 Operating Revenue - Charges for Services 96,000 3 Operating Expenses - Cost of Services 36,700 Inventory of Supplies 36,700 4 Accounts Payable 38,800 Cash 38,800 5 Cash 492,000 Due from Other Funds 492,000 6 Operating Expense - Cost of Services 47,600 Wages Payable 300 Cash 47,900 7 Advance from Enterprise Fund 8,000 Cash 8,000 8 Cash 12,000 Bank Note Payable 12,000 9 Operating Expense - Depreciation 6,900 Accumulated Depreciation 6,900 10 Non Operating Expense - Interest 720 Interest Payable 720 11 Operating Expenses - Cost of Services 980 Wages Payable 980 A. Prepare a Statement of Net Position. B. Prepare a Statement of Cash Flow
Jefferson County operates a centeralized motor pool to service county vehicles. At the endof 2019, the motor pool Internal Service Fund had the following account balances:
Debits:
Due from General Fund $7,000; Cash $17,500; Capital assests $35,000; Supplies $4,000 Total $63,500.
Credits:
Accounts Payable $5,500; Accured Waged Payable $300;
The following
| Jefferson County | |||
| Internal Service Fund Journal Entries | |||
| December 31, 2020 | |||
| Account Title | Debits | Credits | |
| 1 | Inventory of Supplies | 37,500 | |
| Accounts Payable | 37,500 | ||
| 2 | Due from Other Funds | 96,000 | |
| Operating Revenue - Charges for Services | 96,000 | ||
| 3 | Operating Expenses - Cost of Services | 36,700 | |
| Inventory of Supplies | 36,700 | ||
| 4 | Accounts Payable | 38,800 | |
| Cash | 38,800 | ||
| 5 | Cash | 492,000 | |
| Due from Other Funds | 492,000 | ||
| 6 | Operating Expense - Cost of Services | 47,600 | |
| Wages Payable | 300 | ||
| Cash | 47,900 | ||
| 7 | Advance from Enterprise Fund | 8,000 | |
| Cash | 8,000 | ||
| 8 | Cash | 12,000 | |
| Bank Note Payable | 12,000 | ||
| 9 | Operating Expense - Depreciation | 6,900 | |
| Accumulated Depreciation | 6,900 | ||
| 10 | Non Operating Expense - Interest | 720 | |
| Interest Payable | 720 | ||
| 11 | Operating Expenses - Cost of Services | 980 | |
| Wages Payable | 980 |
A. Prepare a Statement of Net Position.
B. Prepare a Statement of Cash Flow for the year.
Solution:
Introduction:
A cash flow statement is one of the financial statements of a business organization and the primary purpose of cash flows is to report all major cash inflows (receipts) and cash outflows ( payments ) including all changes in current assets and current liabilities after adjusting non cash revenues and expenses to the net income during an accounting period. It explains the difference between the beginning and ending cash balances of a company.
When there is an increase in current asset/Assets and decrease in current liability/liabilities, the result is cash paid vice versa, If there When there is a decrease in current asset/Assets and increase in current liability/debts and liabilities, the result is cash received.
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