Author Question: (Entries to prepare government-wide financial statements - revenue and expense accruals) For the ... (Read 363 times)

jasdeep_brar · **on:** Jul 5, 2018

(Entries to prepare government-wide financial statements - revenue and expense accruals)

For the following situations, make adjusting entries necessary to prepare government-wide financial statements.

Where appropriate, take account of the amounts reported in the fund-level financial statements.

a. To prepare its government-wide financial statements for the year ended December 31,2012, the city reported a 900,000 long-term liability for estimated judgments and claims. At December 31, 2013, the city estimated that the long-term liability would be 935,000 . (Hint: Carry forward the starting liability and adjust for the increase.)

b. A city instituted a new sales tax starting January 1, 2012 . It collected 600,000 of sales taxes during 2012 . When the city prepared its fund-level statements, it accrued an additional 200,000 for sales taxes remitted by larger businesses in January, 2013, for taxes collected in the fourth quarter of 2012 . However, smaller businesses are not required to remit fourth quarter collections until April, 2013 . No accrual was made for those taxes, which were estimated to be 28,000 .

c. See facts in situation b. For the calendar year 2013, the city reported sales taxes of 800,000 in its fund-level financial statements. This amount includes all taxes collected in 2013 (applicable to 2013 and 2012), as well as the accrual for larger merchant remittances in January, 2014 . The accrual does not include estimated remittances of 35,000 from smaller merchants in April, 2014 .

Question 2

A(n) ___________________ ___________ happens when an attribute is dependent on a portion of the primary key not on the entire key.
Fill in the blank(s) with correct word

hramirez205 · **Reply #1 on:** Jul 5, 2018

Answer to Question 1

a. Net position 900,000
Judgments and claims expenses 35,000
Judgments and claims liabilities 935,000

(Note: This adjustment can be made in two entries, one of which carries forward the December 31, 2012, liability of 900,000 .)

b. Sales taxes receivable 28,000
Revenues - sales taxes 28,000

c. Sales taxes receivable 35,000
Net position 28,000
Revenues - sales taxes 7000

(Note: Because the 800,000 of revenues reported in the 2013 fund statement includes 28,000 accrued in the 2012 government-wide statement, only 7,000 additional revenue should be accrued for the 2013 government-wide statement.)

Answer to Question 2

partial dependency