ACIS+4124_5124+Chapter+4+Part+1+PowerPoints

ACIS+4124_5124+Chapter+4+Part+1+PowerPoints - ACIS...

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1 ACIS 4124/5124 Chapter 4 – Part 1 Accounting for Governmental Operating Activities—Illustrative Transactions and Financial Statements
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2 Government-Wide Level Budgetary entries are not prepared. Estimated revenues, appropriations, estimated other financing sources and uses, and encumbrances are not recorded.
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3 Assume that the Cedar City General Fund places purchase orders for supplies totaling $510,000. The following entry is made: General Fund: Dr. Cr. Encumbrances—2011 510,000 Reserve for Encumbrances—2011 510,000 Encumbrances Subsidiary Ledger: General Government 110,000 Public Safety 240,000 Public Works 160,000 Encumbrance Accounting
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4 Cedar City received 50% of the goods ordered in the preceding transaction. The actual cost of the goods was $270,000. General Fund: Dr. Cr. Reserve for Encumbrances—2011 255,000 Encumbrances—2011 255,000 Expenditures—2011 270,000 Vouchers Payable 270,000 See next slide for subsidiary ledger entries Accounting for Expenditures
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5 Expenditures Ledger: Dr. Cr. General Government 59,000 Public Safety 125,000 Public Works 86,000 Encumbrances Ledger: General Government 55,000 Public Safety 120,000 Public Works 80,000 Accounting for Expenditures
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6 Governmental Activities: Dr. Cr. Expenses—General Government 59,000 Expenses—Public Safety 125,000 Expense—Public Works 86,000 Vouchers Payable 270,000 Note that the earlier budgetary entry for encumbrances has no effect at the government-wide level Accounting for Governmental Activity Expenses
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7 Encumbrances are not usually recorded for recurring expenditures such as payroll Debit Expenditures for full amount of payroll and credit liabilities for withholdings from employees’ pay; credit Cash for the
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ACIS+4124_5124+Chapter+4+Part+1+PowerPoints - ACIS...

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