General and Special Revenue Fund Accounting

 

Part 1: Research the following statements and write a paper of 500 words on your findings:

• 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