What are the key differences between a governmental unit and a commercial company? Discuss the following terms and how they are...

What are the key differences between a governmental unit and a commercial company?

• Discuss the following terms and how they are used during the budget process of a governmental unit:
  • Appropriations
  • Encumbrances
  • Expenditures
  • Budgetary fund balances
• Give examples for each of the above terms.

Part 2: Given the following information, create the journal entries required for each of the situations described:

 

Estimated revenues
Property taxes	$1,250,000
Fines and forfeits	80,000
Intergovernmental	500,000
Total	$1,830,000
Appropriations
General	$300,000
Streets	50,000
Public safety	800,000
Total	$ 1,150,000

 

1. Make the journal entry to record the adoption of the annual budget.
2. Make the journal entries necessary to record the following cash revenues that were received:

 

Property taxes	$800,000
Fines and forfeits	73,000
Intergovernmental	300,000
Total	$1,173,000

 

1. Purchase orders were issued for the following goods and services:

 

General	$285,000
Streets	50,000
Public safety	670,000
Total	$ 1,005,000

 

1. Purchase orders were fulfilled based upon the following estimated and actual costs:

 

	Estimated	Actual
General	$285,000	$280,000
Streets	50,000	50,000
Public safety	670,000	660,000
Total	$ 1,005,000	$ 990,000