Governmental And Not For Profit Entities
Q3. The city council of E. Staatsboro approved the following budget for the General Fund for fiscal year 2013:
Estimated Revenues
Property taxes.. $335,000
License fees... 40,000
Fines and penalties .15,000
Total revenues .$390,000
Appropriations
Salaries. $350,000
Supplies and utilities. 30,000
Debt service. 3,000
Total appropriations.. 383,000
Budgeted Increase in Fund Balance $ 7,000
The post-closing trial balance for the fund, as of December 31, 2012, was as follows:
Debits
Credits
Cash
$ 15,000
$ 8,000
Vouchers payable
7,000
Fund balance (unassigned)
$15,000
$15,000
The following transactions and events occurred during FY 2013:
1. Levied property taxes of $335,000 and mailed tax bills to property owners.
2. Borrowed $300,000 on tax anticipation notes at an interest rate of 1 percent per annum.
3. Ordered supplies expected to cost $18,000.
4. Received the supplies along with an invoice for $19,000; paid the invoice immediately.
5. Received cash ($383,000) from the following sources: property taxes ($330,000), licenses and fees ($38,000), fines and penalties ($15,000).
6. Paid cash for the following purposes: unpaid vouchers at the start of year ($8,000), salaries ($340,000), utility bills ($11,000).
7. Repaid the tax anticipation notes 6 months after the date of borrowing, with interest.
8. Processed a budgetary interchange, increasing the appropriation for supplies and utilities by $2,000 and reducing the appropriation for salaries by a like amount.
9. Will pay salaries for the last few days in December, amounting to $2,000, at the end of the first pay period in January 2014; also, received in early January 2014 a utilities invoice for $1,000 applicable to December 2013.
Use the preceding information to do the following.
a. Prepare journal entries to record the budget and the listed transactions and events.
b. Prepare a pre-closing trial balance.
c. Prepare a balance sheet; a statement of revenues, expenditures, and changes in fund balance.
d. Prepare closing journal entries.