property in the General Fund
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During the year, a local merchant donated a building to the city of Stage Coach. The original cost of the building was $300,000.
Multiple Choice
$600,000.
$50,000.
$0.
$300,000.
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- Utica Corporation paid 360,000 to purchase land and a building. An appraisal showed that the land is worth 100,000 and the building is worth 300,000. What cost should Utica assign to the land and to the building, respectively?On January 1, 20X1, the city government of Faraway donated property to Amazing, Inc., in return for the commitment from the company that it would build a manufacturing plant on the site and employ residents of the city in the plant. Information on the donated land appears below. Cost of the land paid by Faraway = $1,000,000 Fair valiue of the land at time of donation = $1,865,000 What is the donation revenue recognized by Amazing, Inc.?For the following transactions, prepare the entries that would be recorded in the general fixed assets account group for the city of Evert.a. The city purchased property costing $1,300,000, with three-fourths of the cost allocated to a building.b. A mansion belonging to the great-granddaughter of the city’s founder was donated to the city. The land cost the original owner $600, and the house was built for an additional $50,000. At the time of donation, the property had an estimated fair value of $550,000, of which $330,000 was allocable to the land. The property was accepted and is to be used as a park and a museum.c. A central fire station, financed by general obligation bonds, was two-thirds complete at yearend with costs to date of $800,000 that were recorded in the capital project fund.d. A new fire engine was purchased for $165,000. The city traded a used fire engine originally purchased for $100,000. The trade-in value was $25,000. Both engines were purchased from general…
- Irrespective of how capital assets are acquired, they are recorded differently in governmental funds than in businesses. In a recent year, Ives Township acquired six police cars at a total cost of $200,000. The vehicles are expected to have a useful life of four years. Prepare the journal entries that the township would make in its general fund in the year of acquisition for each of the following assumptions: It paid for the cars in cash at the time of acquisition. It leased the cars and agreed to make, starting in the year of acquisition, four equal payments of $63,095, an amount that represents the annuity required to liquidate a loan of $200,000 at 10 percent interest. The lease would satisfy the criteria necessary to be accounted for as a capital lease. It issued $200,000 in installment notes to the car dealer, agreeing to repay them in four annual payments of $63,095, starting in the year of acquisition. 2. Comment on how any “off the balance sheet” assets or obligations…Scofield City received a donation from the estate of the late Lisa O’Reilly to be used to support the city’s public library. The gift consisted of $200,000 cash and a portfolio of securities with a market value of $350,000. The securities have a book value of $250,000. The donor stipulated that the principal of the gift, including investment gains (realized and unrealized) but excluding investment losses, must be kept intact. The income must be used to care for and maintain the book collection at the newly renamed O’Reilly Public Library. All appropriate costs, including investment losses, may be charged against the revenues yearly to determine the amount available for the specified purposes. During the year, the city engaged in the following transactions on behalf of the library. Prepare the appropriate entries in the city’s permanent fund. a) Accepted the donation. b) Received dividends and interest of $18,000. c) Purchased securities for $200,000. d) Sold securities that were part…Dodd Village received a gift of a new fire engine from a local civic group. The fair value of this fire engine was $400,000. Which of the following is the correct entry to be made in the general fixed assets account group for this gift? Debit Credita. Memorandum entry onlyb. General Fund Assets . . . . . . . . . . . . . . . . . . . . . . . . .. 400,000Private Gifts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 400,000c. Investment in General Fixed Assets . . . . . . . . . . . .400,000Gift Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 400,000d. Machinery and Equipment . . . . . . . . . . . . . . . . . . . 400,000Investment in General Fixed Assets from Private Gifts 400,000
- Monty Corporation donates equipment and a truck to the community Home Assistance Centre. The equipment had a cost of $93,000, accumulated depreciation to the contribution date of $46,000, and a fair value of $46,000. The truck had a cost of $42,000, accumulated depreciation to the contribution date of $37,000, and a fair value of $24,000. Prepare the journal entry Monty Corporation would make for the donation.The president of ACCO 202 Corporation donated a building to Ana G. Méndez Corporation. The building had an original cost of $200,000, a book value of $75,000, and a fair market value of $180,000. To record this donation, Ana G. Méndez would a. Make a memorandum entry b. Debit Building for $75,000 and credit Gain for $75,000 c. Debit Building for $200,000 and credit Gain for $200,000 d. Debit Building for $180,000 and credit Gain for $180,000On January 2, Basketville City purchased equipment with a useful life of three years to be used by its capital project fund. Which of the following is the correct treatment for the asset? A.) Capitalize; depreciation is optional B.) Capitalize; depreciation is required C.) Capitalize; depreciation is not permitted. D.) Record the purchase of the equipment as an expenditure
- The president of Christmas Corporation donated a building to Tuesday Corporation. The building had an original cost of $675,000, a book value of $255,000, and a fair market value of $475,000. The journal entry by Tuesday Corporation to record this donation will include a debit Building for $255,000 and credit Gain for $255,000. debit Building for $675,000 and credit Gain for $200,000. debit Building for $475,000 and credit Gain for $200,000. debit Building for $475,000 and credit Gain for $475,000.As of July 1, 2017, the Village of Boiling Springs decided to purchase a privately operated swimming pool and to create a swimming pool (enterprise) fund. During the year, the following transactions occurred: A permanent contribution of $600,000 was received from the general fund. b.Revenue bonds were sold at par in the amount of $1,200,000. c.Several items were purchased for cash, with a cost breakdown as follows: land, $300,000; building, $400,000, land improvement, $400,000; equipment, $200,000; and supplies, $150,000. d.Charges for services amounted to $600,000, all received in cash. Cash expenses included salaries of $200,000; utilities of $100,000; and interest of $72,000. f.Supplies were consumed in the amount of $120,000. Depreciation was recorded as follows: building, $20,000, land improvement, $20,000; and equipment, $20,000. The books were closed. Close all accounts to net position. Required: Prepare a Statement of Revenues, Expenses, and Changes in Fund Net…Prepare journal entries to record the following events using the general fund and the general fixed assets account group: a. The general fund vouchered the purchase of trucks for $80,000. The purchase had been encumbered earlier in the year at $75,000. b. Several years ago, equipment costing $15,000 was acquired with general fund revenues. It was sold for $6,000, with proceeds belonging to the general fund. c. Early in the year, a citizen donated to the city land appraised at $100,000. She submitted plans for a new library and agreed to cover the total cost of construction, paying the company directly as work proceeded. At year-end, the building was two-thirds finished, with costs to date of $300,000. The expenditures are recorded in a capital projects fund. d. A snow plow was purchased with general fund cash for $92,000, which represented a cost of $110,000 less trade-in of $18,000 for an old snow plow originally purchased for $66,000 from special revenue funds. As an emergency…
