General fund is the primary fund maintained by the companies for recording all inflows and outflows except which are associated with the special purpose funds. It is mostly the difference between assets and liabilities of the company’s fund. Encumbrances: It is the amount set aside to pay in the future liability of goods and services ordered but not yet received. It also reflects the commitment in accounting system. The effect encumbrances in general fund account.

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Chapter 17, Problem 17.18.25P

To determine

Introduction: General fund is the primary fund maintained by the companies for recording all inflows and outflows except which are associated with the special purpose funds. It is mostly the difference between assets and liabilities of the company’s fund.

Encumbrances: It is the amount set aside to pay in the future liability of goods and services ordered but not yet received. It also reflects the commitment in accounting system.

The effect encumbrances in general fund account.

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