ASSIGNMENT
Q1. (Preparation of governmental funds financial statements)
Following are December 31, 2013 pre-closing trial balances (budgetary accounts excluded) for the General Fund, Debt Service Fund, and Capital Projects Fund for Hebert County. Prepare a governmental funds balance sheet and a statement of revenues, expenditures, and changes in fund balances as of and for the year ended December 31, 2013. The General Fund had encumbrances of $25 outstanding on December 31, 2013. (All amounts are in thousands of dollars.) (2.5 marks)
Debits Credits
General Fund
Cash $1,900
Property taxes receivable – delinquent 330
Allowance for uncollectible property taxes $ 10
Accounts payable 120
Deferred revenues 250
Unassigned fund balance, January 1, 2013 1,720
Revenues – property taxes 3,200
Revenues – licenses and fees 350
Revenues – parks admissions fees 40
Investment income 220
Expenditures – general government 360
Expenditures – public safety 1,800
Expenditures – public works 840
Expenditures – parks and culture 350
Transfer out to Debt Service Fund 250
Transfer out to Capital Projects Fund 80 ____ Totals $5,910 $5,910
Debt Service Fund
Cash $70
Assigned fund balance, January 1, 2013 $60
Expenditures – bond principal 110
Expenditures – interest 130
Transfer in from General Fund ___ 250
Totals $310 $310
Capital Projects Fund
Cash $240
Expenditures – capital outlay 420
Transfer in from General Fund $80
Proceeds of bonds ___ 580
Totals $660 $660
QUESTION-2
The following transactions relate to the Scott Business venture. Which two of the following six possibilities occurred as a result of each transaction – an asset increased, an asset decreased, a Liability increased, a liability decreased, equity increased, or equity decreased:
(SHOW INCREASE (+) DECREASE (-) (5 marks)
Scott invests $20,000 cash to start the business in return for stock.
Purchased supplies paying $1,000 cash.
Purchased equipment for $15,000 cash.
Purchased Supplies of $200 and Equipment of $1,000 on account.
Borrowed $4,000 from 1st American Bank.
Provided consulting services receiving $3,000 cash.
Paid salaries of $800 to employees.
Dividends of $500 are paid to shareholders
$ 1000 amount paid to the creditor against equipment purchase
Paid outstanding electricity bills $ 500
Q3. From the below statement whether the following are true or false. For the false items, explain why they are false. (2.5 marks)
Enterprise Funds are used only when all services are provided to non-governmental entities, and Internal Service Funds are used only when all services are provided to governmental agencies that are a part of the reporting government.
Enterprise Funds use the economic resources measurement focus and full accrual basis of accounting only when they want to compute the costs of services; otherwise, they use the current financial resources measurement focus and modified accrual basis of accounting.
The primary activities of the State Office of General Services and the State Parks Department are financed from General Fund appropriations. The former department also operates a governmental motor pool and the latter operates a public swimming pool. Because their primary activities are financed from the General Fund, they may not under any circumstances account for other activities in proprietary funds.
Question no. 4
What are the Approaches that Financial Statement and Financial Condition can be analyzed?
(2.5 marks)
Answer
Question 5
X Y Z football association uses the following types of funds for the football team’s purposes: Using General Fund; Specific Purpose Funds; Plant Replacement and Expansion Fund; and Endowment Fund. State which fund (or funds) would be used to account for each of these transactions or events. (2.5 marks)
a-His Excellency has given 5 million SR an additional amount as an aid to the football team to promote the football game.
b- Minister has given fund an amount 10 Million SR, to be used exclusively making a new football ground for adding new place and location for practicing football.
c- An amount of 20 Million SR, paid to a foreign football coach for special training to the players to be used exclusively for training.
d-An amount of 3 million SR has been paid to the star players of the years as a reward.
e-As per the government plan, an amount of 20 million will be paid to the football teams to encourage the newcomer’s football players.
Answer:
