The beginning balances as of 1/1/2017 for the City of Monroe\'s General Fund are
ID: 2510264 • Letter: T
Question
The beginning balances as of 1/1/2017 for the City of Monroe's General Fund are listed below. The City follows the modified accrual accounting method for its general fund journal entries and financial statements. The following steps are required for this project.
Beginning balances: Cash $711,250; Delinquent Property Taxes Receivable $210,000; Allowance for Uncollectible Property Taxes $37,000; Accounts Payable $99,000; Due to Other Funds $27,000; Deferred Inflows of Resources $210,000; Total Fund Balance $548,250
Step 1) Record journal entries for the following transactions for FY2017 in Tab #1.
Step 2) Create a trial balance as of 12/31/2017 in Tab #1. Exclude any budgetary accounts from the trial balance.
Step 3) Record the appropriate closing entries in Tab #2. Outstanding encumbrances at year end are classified as Assigned Fund Balance and all remaining net resources are classified as Unassigned Fund Balance. The Supplies Inventory on hand at yearend was deemed immaterial and not classified as nonspendable. Based on this information, complete the Fund Balance Table in Tab #2.
Step 4) Prepare the Statement of Revenue, Expenditures and Changes in Fund Balance (Tab #3) and the Balance Sheet (Tab #4) for the General Fund as of 12/31/2017.
JE 1. As of January 1, 2017, the City Council approved and the mayor signed a budget calling for $11,150,000 in property tax and other revenue, $9,350,000 in appropriations for expenditures, and $1,700,000 to be transferred to the debt service funds for the payment of principal and interest.
2.Encumbrances of $170,000 for purchase orders outstanding at the end of 2016 were re-established.
3.The January 1, 2017, balance in Deferred Inflows – Property Taxes relates to the amount of the 2016 levy that was expected to be collected more than 60 days after December 31. This amount was also reclassified into delinquent receivables at the end of 2016. The full amount was collected in 2017.
4.A general tax levy in the amount of $6,800,000 was made for 2017 property taxes. It is estimated that 2.25% of the tax will be uncollectible.
5.Bonds in the amount of $500,000 were issued.
6.Goods and supplies related to all encumbrances outstanding as of December 31, 2016 were received, along with invoices amounting to $166,600. The City uses the Purchases Method to account for supplies inventory.
7.The amount due to other funds was paid. This went to the Proprietary Fund.
8.The General Fund collected the following in cash: o current year property taxes, $6,400,000; o sales taxes, $2,890,000.
9.Purchase orders for equipment were issued in the amount of $3,465,000.
10.Invoices for most of the equipment ordered in transaction 9 were received in the amount of $3,375,300 and paid. The related encumbrance amounted to $3,407,000.
11.The General Fund also transferred to the debt service funds cash in the amount of $1,662,000 for the recurring payment of principal and interest.
12.It is estimated that $10,500 of the outstanding taxes receivable will be collected more than 60 days beyond the fiscal year-end. The remaining balance in property tax receivable was transferred to delinquent property tax receivable.
13.The General Fund received supplies from the City's Internal Service Fund (proprietary fund) in the amount of $313,200. It still owes payment to the fund at yearend. The Purchase Method is used
Explanation / Answer
Deferred Inflows of Revenue Dr
210000
to Revenue
210000
Property Tax Receivables
6800000
to Revenue
6800000
Bad Debts Dr
153000
to Property Tax Receivables
153000
Cash Balance Dr
500000
to Bonds
500000
Inventory Dr
166600
To Accounts Payable
166600
Other Funds Dr
27000
to Cash Balance
27000
Cash Accounts Dr
6400000
To property Tax Receivables
6400000
Cash Accounts Dr
2890000
To Sles Tax Receivables
2890000
Equipment Dr
3375300
to Cash Balance
3375300
General Fund Dr
1662000
To Debt Service Fund
1662000
Debt Service Fund Dr
1662000
To Cash
1662000
Property Tax Recevable Dr
10500
to Revenue
10500
Cash Account Dr
313200
To Total Fund Balance ( Equity )
313200
Particulars
DR
CR
Accumulated Dr
Accumulated Cr
Dr
Cr
BS
Cash Balance
711250
10560300
3402300
7869250
0
BS
Property Tax Receivables
210000
6810500
7010000
10500
0
BS
Allowance for uncollectible property tax
37000
0
37000
BS
Accounts Payable
99000
166600
0
265600
BS
Other Funds
27000
27000
0
0
BS
Deferred Inflows of Revenue
210000
210000
0
0
BS
Total Fund Balance ( Equity )
548250
313300
0
861550
PL
Revenue
7020500
0
7020500
PL
Bad Debts
153000
153000
0
BS
Bonds
500000
0
500000
BS
Inventory
166600
166600
0
PL
Sales Tax Receivable
2890000
0
2890000
BS
Equipment
3375300
3375300
0
0
0
921250
921250
21302700
21302700
11574650
11574650
Deferred Inflows of Revenue Dr
210000
to Revenue
210000
Property Tax Receivables
6800000
to Revenue
6800000
Bad Debts Dr
153000
to Property Tax Receivables
153000
Cash Balance Dr
500000
to Bonds
500000
Inventory Dr
166600
To Accounts Payable
166600
Other Funds Dr
27000
to Cash Balance
27000
Cash Accounts Dr
6400000
To property Tax Receivables
6400000
Cash Accounts Dr
2890000
To Sles Tax Receivables
2890000
Equipment Dr
3375300
to Cash Balance
3375300
General Fund Dr
1662000
To Debt Service Fund
1662000
Debt Service Fund Dr
1662000
To Cash
1662000
Property Tax Recevable Dr
10500
to Revenue
10500
Cash Account Dr
313200
To Total Fund Balance ( Equity )
313200
Particulars
DR
CR
Accumulated Dr
Accumulated Cr
Dr
Cr
BS
Cash Balance
711250
10560300
3402300
7869250
0
BS
Property Tax Receivables
210000
6810500
7010000
10500
0
BS
Allowance for uncollectible property tax
37000
0
37000
BS
Accounts Payable
99000
166600
0
265600
BS
Other Funds
27000
27000
0
0
BS
Deferred Inflows of Revenue
210000
210000
0
0
BS
Total Fund Balance ( Equity )
548250
313300
0
861550
PL
Revenue
7020500
0
7020500
PL
Bad Debts
153000
153000
0
BS
Bonds
500000
0
500000
BS
Inventory
166600
166600
0
PL
Sales Tax Receivable
2890000
0
2890000
BS
Equipment
3375300
3375300
0
0
0
921250
921250
21302700
21302700
11574650
11574650
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