Chapter_3_HW_KEY - CHAPTER 3: GOVERNMENTAL OPERATING...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: CHAPTER 3: GOVERNMENTAL OPERATING STATEMENT ACCOUNTS; BUDGETARY ACCOUNTING 3-1. Each student should have a different governmental annual report, so will have different answers to the questions in this exercise. Some time spent in class to allow students to report on their own answers and to get an idea of the range of answers of other students is useful. 3-2. 1. d . 6. b . 3. c. 8. c. 4. a . 5. a. 10. c. 3-4. City of Marion a . Estimated revenues totalFY 2011 $ 4,650,000 Appropriations totalFY 2011 4,800,000 Therefore, fund balance at the end of FY 2010 must be at least $ 150,000 or else the fund would be thrown into a deficit. 3-1 General Ledger Subsidiary Ledger Debits Credits Debits Credits b . ESTIMATED REVENUES 4,650,000 BUDGETARY FUND BALANCE 150,000 APPROPRIATIONS 4,800,000 Estimated Revenues Ledger: TAXES 3,000,000 INTERGOVERNMENTAL REVENUES 1,000,000 LICENSES AND PERMITS 400,000 FINES AND FORFEITS 150,000 MISCELLANEOUS REVENUES 100,000 Appropriations Ledger : GENERAL GOVERNMENT 950,000 PUBLIC SAFETY 2,000,000 PUBLIC WORKS 950,000 HEALTH AND WELFARE 850,000 MISCELLANEOUS 50,000 3-2 3-5. General Ledger Subsidiary Ledger Debits Credits Debits Credits a . ENCUMBRANCES 2011 394,000 RESERVE FOR ENCUMBRANCES 2011 394,000 Encumbrances Ledger : GENERAL GOVERNMENT 50,000 PUBLIC SAFETY 200,000 PUBLIC WORKS 75,000 HEALTH AND WELFARE 65,000 MISCELLANEOUS 4,000 b . Purchase orders issued by a governmental fund have the effect of using all or a portion of one or more appropriations for that fund. Issuance of purchase orders or other commitment documents is a step in the expenditure of an appropriation; administrators may be subject to legal penalties if they expend more resources than were appropriated. Recording encumbrances helps administrators avoid overexpending appropriations. The same legal issues do not exist in business organizations, although a well-managed business should certainly keep track of outstanding purchase orders and contracts to have a clear understanding of what transactions are in process that will result in the acquisition of assets, the incurring of expenses, and the incurring of liabilities....
View Full Document

Page1 / 9

Chapter_3_HW_KEY - CHAPTER 3: GOVERNMENTAL OPERATING...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online