I need help with Smithville Project. Prior to preparing financial statements at

Question

I need help with Smithville Project.

Prior to preparing financial statements at the end of FY 2014, it is necessary to record depreciation expense for the year for governmental activities at the government-wide level. Based on general capital assets assigned to specific functions, depreciation expense related to equipment and infrastructure is allocated to functions as shown below:

Equipment    Infrastructure

General Government 38,160

Public Safety 198,240.00

Public Works 76,280.00 $106,560

Health and Welfare 19,100.00

Culture and Recreation 49,600.00

Totals $ 381,380 $106,560

In addition, depreciation expense for buildings in the amount of $188,000 is allocated to functions according to the percentage of total floor space of buildings used by each function. The Public Works director has provided the following information for the current year:

Percentage of Building

Floor Space Used

General Government 20%

Public Safety 35%

Public Works 22%

Health and Welfare 10%

Culture and Recreation 13%

Total 100%

Required: [Para. 9-a] Record depreciation expense for the year 2014 in the governmental activities general journal at the government-wide level. Round all amounts to the nearest whole dollar. Verify accuracy of the adjusting entries and post to the general ledger by clicking [Post Entries].

Explanation / Answer

In the Above mentioned question we need to pass journal entries based on depreciation on Equipment, Infrastructure and Buildings .  

Depreciation on buildings is $188000 (Given in Question)

Depreciation on infrastructure $106560 (Given in Question)

Depreciation on Equipment is Inclusive of Dep on building (which is $188000) = $193380 ( 381380 - 188000)

See the workings - I have Deducted the proportion of $188000 from the Equipment Depreciation

JOURNAL ENTRIES

A )Depreciation A/C Dr 487940

To Buildings A/c $188000

To Equipment A/C $193380

To Infrastructure A/C $106560

( Being Depreciation charged on building , Equipement and Infrastructure )

B ) Profit and Loss A/C Dr 487940

To Depreciation A/C Cr 487940

( Being Depreciation Expense Charged to P/L)

LEDGER

Buidling
Usage Dep Exp
Apportioned Equipment
TOTAL Infrastructure
Total Net Equipment
Depreciation General Government 20% 20% 37600 38160 560 Public Safety 35% 35% 65800 198240 132440 Public Works 22% 22% 41360 76280 106560 34920 Health and Welfare 10% 10% 18800 19100 300 Culture and Recreation 13% 13% 24440 49600 25160 Total $ 188000 381380 106560 193380

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