6 The following transactions occurred for the City of Fontaine’s General Fund. 1
ID: 2420513 • Letter: 6
Question
6 The following transactions occurred for the City of Fontaine’s General Fund.
1. The budget prepared for the fiscal year included Total estimated revenues of $2,774,000 and appropriations of $2,693,000.
2. Encumbrances issued against the appropriations during the year were $931,000.
3. The current year’s tax levy of $2,005,000 was recorded; uncollectibles were estimated as $65,000.
4. Collections of delinquent taxes from prior years’ levies totaled $132,000; collections of the current year’s levy totaled $1,459,000.
5. Invoices were received and approved for payment for items ordered in documents recorded as encumbrances in Transaction (2) of this problem. The estimated liability was $851,200. Actual costs were $850,500.
6. Revenue other than taxes collected during the year consisted of licenses and permits, $373,000; intergovernmental revenue, $400,000; and $66,000 of miscellaneous revenues.
7. Payments on Vouchers Payable totaled $1,505,000.
Prepare journal entries in the General Fund general journal to record the transactions. (Subsidiary detail may be omitted.)
Explanation / Answer
Description
Debit
Credit
1
Estimated Revenues
$2,774,000
Appropriations
$2,693,000
Budgetary Fund Balance
$ 81000
2.
Encumbrances
$931,000
Fund Balance Reserved for Encumbrances
$931,000
3.
Property Taxes Receivable
$2,005,000
Allowance for Uncollectible Tax
$65,000
Revenues
$1,940,000
4.
Cash
$1,327,000
Property Taxes Receivable
$1,327,000
5.
Fund Balance Reserved For Encumbrances
$931,000
Encumbrances
$931,000
Expenditures
$850,500
Vouchers Payable
$850,500
6.
Cash
$839,000
licenses and permits
$373,000
intergovernmental revenue
$400,000
miscellaneous revenues
$66,000
7.
Vouchers payable
$1,505,000
Cash
$1,505,000
Description
Debit
Credit
1
Estimated Revenues
$2,774,000
Appropriations
$2,693,000
Budgetary Fund Balance
$ 81000
2.
Encumbrances
$931,000
Fund Balance Reserved for Encumbrances
$931,000
3.
Property Taxes Receivable
$2,005,000
Allowance for Uncollectible Tax
$65,000
Revenues
$1,940,000
4.
Cash
$1,327,000
Property Taxes Receivable
$1,327,000
5.
Fund Balance Reserved For Encumbrances
$931,000
Encumbrances
$931,000
Expenditures
$850,500
Vouchers Payable
$850,500
6.
Cash
$839,000
licenses and permits
$373,000
intergovernmental revenue
$400,000
miscellaneous revenues
$66,000
7.
Vouchers payable
$1,505,000
Cash
$1,505,000
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