loader  Loading... Please wait...

Question(s) / Instruction(s):

     28.     (Analyzing and assessing the implications of a government's account balances)

Following is a pre-closing trial balance of a village's General Fund at December 31, 2008. The amount shown as Fund balance (unreserved) has not changed since the year started. The amount shown as appropriations includes the amounts appropriated for transfers. Property tax invoices are mailed out on January 10 and are due to be paid on February 10. Property owners that have not paid their taxes are classified as delinquent on March 10.


 

 

 

Debits

Credits

 

 

Cash

 

$4,000

 

 

Property taxes receivable, delinquent

22,000

 

 

Allowance for uncollectible property

 

 

 

taxes, delinquent

 

$5,000

 

 

Salaries payable

 

6,000

 

 

Due to Water Enterprise Fund

 

3,000

 

 

Accounts payable

 

16,000

 

 

Fund balance (unreserved)

 

3,000

 

 

Property tax revenues

 

250,000

 

 

Sales tax revenues

 

40,000

 

 

Expenditures - salaries

220,000

 

 

Expenditures - other than

 

 

 

personal services

23,000

 

 

Expenditures - utilities

14,000

 

 

Transfer to Debt Service Fund

30,000

 

 

Transfer to Water Enterprise Fund

10,000

 

 

Estimated revenues (total)

297,000

 

 

Appropriations (total)

 

300,000

 

 

Budgetary fund balance

3,000


 

 

 

Totals

$ 623,000

$623,000

Required:
Based on the information contained in the foregoing trial balance, answer the following questions.
          a.     When the budget was adopted, what budgetary results did the village anticipate? (Assume the budgetary amounts shown in the trial balance represent the budget as originally adopted by the village.)
          b.     What were the results of operations for the year? Did the fund balance increase or decrease as a result of the year's activities, and by how much? How much will the amount of the unreserved fund balance be after the books are closed?
          c.     Based on your analysis of the data, what appears to be the major cause (or causes) of the difference between the anticipated and the actual operating results?
          d.     Discuss possible reasons for the transfers to the Debt Service Fund and the Water Enterprise Fund.
          e.     Discuss several possible reasons for the amount shown as Due to Water Enterprise Fund.
          f.     Assess the financial condition of the village based on the information given in the problem. Include a discussion of the village's current and quick ratios in developing your conclusion.

Find Similar Answers by Subject


Student Reviews

Rate and review your solution! (Please rate on a Scale of 1 - 5. Top Rating is 5.)


Expert's Answer
Download Solution:
$2.00

This solution includes:

  • Plain text
  • Cited sources when necessary
  • Attached file(s)
  • Solution Document(s)

You Recently Viewed...



Reach Us

408-538-8534

20-3582-4059

39-008-4233

+1-408-904-6494