ACIS+4124_5124+Chapter+4+Part+2+PowerPoints

ACIS+4124_5124+Chapter+4+Part+2+PowerPoints - 1 ACIS...

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Unformatted text preview: 1 ACIS 4124/5124 Chapter 4 Part 2 Accounting for Governmental Operating ActivitiesIllustrative Transactions and Financial Statements 2 Assume that $45,000 in property tax revenue has not been collected at year-end. If $20,000 of this revenue is not expected to be collected shortly after year-end (i.e., within 60 days), the revenue must be reclassified as deferred revenue: General Fund: Dr. Cr. Revenues 20,000 Deferred Revenue 20,000 Revenues Ledger: Property Taxes 20,000 Deferred Property Tax Revenue 3 Deferred Property Tax Revenue Deferred Revenue is a current liability. The revenue is not reclassified to deferred revenue at the government- wide level. 4 Budget Revisions Occasionally, budgets must be revised due to: New information Errors in the original budget estimates Changes is economic conditions Changes in laws and regulations related to grants and shared revenues Changes in amounts charged for services, licenses, permit, fines, etc. 5 How are Budget Revisions Recorded? If estimated revenues are increased, debit Estimated Revenues and credit Budgetary Fund Balance. If appropriations are increased, debit Budgetary Fund Balance and credit Appropriations. A decrease in either item would result in the reverse of the above entry. 6 Accounting for encumbrances depends on the budget laws of a particular state or other government In some jurisdictions, appropriations do not expire at year-end In other jurisdictions, appropriations lapse and encumbrances for goods on order at year-end require a new appropriation in the next fiscal year Encumbrances of a Prior Year 7 Encumbrances of a Prior Year Assume at the end of FY 2011, Encumbrances of $8,300 are still outstanding and the government intends to honor these encumbrances. The encumbrances relate to goods ordered by the Public Works function. Early in FY 2012, the goods are received at an actual cost of $8,500. What entry would be prepared to record the receipt of the goods? 8 Encumbrances of a Prior Year General Fund: Dr. Cr. Reserve for Encumbrances2011 8,300 Encumbrances2011 8,300 Expenditures2011 8,300 Expenditures2012 200 Vouchers Payable 8,500 Encumbrances Ledger: Public Works2011 8,300 Expenditures Ledger: Public Works2011 8,300 Public Works2012 200 Note that only $200 is charged to the FY 2012 appropriation The following entry is made in the General Fund journal: 9 Encumbrances of a Prior Year...
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This note was uploaded on 03/28/2012 for the course ACIS 4124 taught by Professor Dr.easterwood during the Spring '12 term at Virginia Tech.

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ACIS+4124_5124+Chapter+4+Part+2+PowerPoints - 1 ACIS...

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