LooseLeaf for Advanced Accounting (Irwin Accounting) - Standalone book
13th Edition
ISBN: 9781259444951
Author: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik
Publisher: McGraw-Hill Education
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Question
Chapter 17, Problem 36P
a.
To determine
Prepare a statement of activity and statement of net position for governmental activities for city B.
a.
Expert Solution
Explanation of Solution
Statement of activity in the books of city B:
Statement of activities | |||||
Program revenue | Net revenue and change in net assets | ||||
Program | Expenses | Charges for services | Grants and contribution | Governmental activities | Total |
Primary Government: | |||||
Governmental activities: | |||||
General Governmental | $180,000 | $15,000 | ($165,000) | ($165,000) | |
Public Safety | $158,000 | $8,000 | ($150,000) | ($150,000) | |
Public Works | $159,500 | $12,000 | ($147,500) | ($147,500) | |
Health and Sanitation | $37,000 | $31,000 | $25,000 | $19,000 | $19,000 |
Interest on debt | $42,000 | ($42,000) | ($42,000) | ||
Total Governmental | |||||
Activities | $576,500 | $66,000 | $25,000 | ($485,500) | ($485,500) |
Table: (1)
Working note:
Computation of closing amount of net assets:
General Revenues: | Amount |
Property taxes received | $ 630,000 |
Sales Taxes | $ 99,000 |
Dividend Income | $ 20,000 |
Gain on Sale of Investments | $ 14,000 |
Gain on Investments | $ 5,000 |
Total general revenues | $ 768,000 |
$ - | |
Change in net assets: | $ - |
Net assets – beginning | $ 120,000 |
Change | $ 282,500 |
Net assets – ending | $ 402,500 |
Table: (2)
Statement of net position in the books of city P:
Statement of net assets | |
Particulars | Governmental activities |
Assets | |
Current Assets: | |
Cash & Equivalents | $139,000 |
Prepaid insurance | $6,000 |
Investments | $116,000 |
Receivables | $120,000 |
Inventories | $6,000 |
Total Current Assets | $387,000 |
Capital Assets: | |
Building (Net of | $240,000 |
Building (Net of depreciation) | $199,500 |
Equipment (Net of depreciation) | $81,000 |
Truck (Capital Lease) | $64,000 |
Total Assets | $971,500 |
Liabilities: | |
Current Liabilities: | |
Wages Payable | $36,000 |
Noncurrent Liabilities: | |
Lease Obligation | |
Payable | $64,000 |
Closure Liability | |
Landfill | $39,000 |
Long-term Notes | |
Payable | $430,000 |
Total Liabilities | $569,000 |
Net assets | |
Invested in capital assets, | |
net of related debt | $154,500 |
Unrestricted (deficit) | $248,000 |
Total Net Assets | $402,500 |
Table: (2)
b.
To determine
Prepare a statement of revenue, expenditure and change in fund balance and a balance sheet for the city B.
b.
Expert Solution
Explanation of Solution
Statement of revenue, expenditure and change in fund balance | |
Revenues: | Amount |
Government Funds | |
Property taxes received | $630,000 |
Sales taxes | $99,000 |
Dividend income | $20,000 |
Charges for Services | $66,000 |
Grant | $25,000 |
Investments (Realized Gain) | $14,000 |
Investments (Unrealized Gain) | $5,000 |
Total | $859,000 |
Expenditures: | |
Current: | |
General Governmental | $150,000 |
Public Safety | $149,000 |
Public Works | $122,000 |
Health and Sanitation | $37,000 |
Debt Service: | |
Principal payment on debt | $10,000 |
Interest on debt | $42,000 |
Capital Outlay: | |
Building | $210,000 |
Equipment | $90,000 |
Truck—leased | $64,000 |
Total expenditures | $874,000 |
Excess (deficiency) of revenues | |
over expenses) | ($15,000) |
Other Financing Sources: | |
Proceeds from long-term note | $200,000 |
Capitalized lease—truck | $64,000 |
Total other financing sources | $264,000 |
Net Changes in fund balance | $249,000 |
Fund balance—beginning | $90,000 |
Less: increase in encumbrances | ($31,000) |
Fund balance—ending—unrestricted | |
and unreserved | $308,000 |
Table: (3)
Balance sheet in the books of city B for the year 2017:
Balance sheet for the year ended 31 December 2017 | |
Particulars | Amount |
Assets | |
Cash and cash equivalents | $139,000 |
Investments | $116,000 |
Receivables, net | $120,000 |
Supplies | $6,000 |
Prepaid Insurance | $6,000 |
Total Assets | $387,000 |
Liabilities and Fund Balances | |
Liabilities: | |
Salaries Payable | $36,000 |
Fund Balances | |
Reserved fund balances | |
Encumbrances | |
Equipment | $24,000 |
Supplies | $7,000 |
Supplies | $6,000 |
Prepaid Insurance | $6,000 |
Unrestricted, unreserved | $308,000 |
Total Fund Balance | $351,000 |
Total Liabilities and Fund Balance | $387,000 |
Table: (4)
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Chapter 17 Solutions
LooseLeaf for Advanced Accounting (Irwin Accounting) - Standalone book
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