Solution Manual For Essentials of Accounting For Governmental and Not For Profit Organizations 14th Edition Paul Copley
Solution Manual For Essentials of Accounting For Governmental and Not For Profit Organizations 14th Edition Paul Copley
Solution Manual For Essentials of Accounting For Governmental and Not For Profit Organizations 14th Edition Paul Copley
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-1.
A. SPECIAL-PURPOSE GOVERNMENTAL ENTITIES ENGAGED IN BOTH GOVERNMENTAL AND
BUSINESS-TYPE ACTIVITIES AND IN MORE THAN ONE GOVERNMENTAL ACTIVITY ARE REQUIRED
TO FOLLOW THE SAME REPORTING REQUIREMENTS AS GENERAL PURPOSE GOVERNMENTS, SUCH
AS STATES, COUNTIES, AND MUNICIPALITIES. FINANCIAL REPORTS REQUIRED INCLUDE THE
GOVERNMENT-WIDE STATEMENT OF NET POSITION AND STATEMENT OF ACTIVITIES AND THE
GOVERNMENTAL FUNDS BALANCE SHEET AND STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES. IF APPLICABLE, THE PROPRIETARY FUNDS STATEMENT OF NET
POSITION, STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION AND
STATEMENT OF CASH FLOWS WOULD BE REQUIRED.
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-1
9-2.
WARRENTON LIBRARY DISTRICT
GOVERNMENTAL FUNDS BALANCE SHEET / STATEMENT OF NET POSITION
AS OF DECEMBER 31, 2020
SPECIAL ADJUSTMENTS TO
GENERAL REVENUE GOVERNMENT - STATEMENT OF
ASSETS FUND FUND TOTAL WIDE NET POSITION
CASH AND CASH EQUIVALENTS 130,000 12,000 142,000 142,000
INVENTORIES 6,000 6,000 6,000
RECEIVABLES (NET)
TAXES RECEIVABLE 90,000 90,000 90,000
DUE FROM GENERAL FUND 7,500 7,500 (7,500) -
CAPITAL ASSETS - 335,000 335,000
TOTAL ASSETS 226,000 19,500 245,500 327,500 573,000
LIABILITIES
ACCOUNTS PAYABLE 85,000 3,500 88,500 88,500
DUE TO SPECIAL REVENUE FUND 7,500 7,500 (7,500) -
LONG-TERM COMPENSATED
ABSENCES - 85,000 85,000
NOTES DUE IN MORE THAN ONE YEAR - 222,000 222,000
TOTAL LIABILITIES 92,500 3,500 96,000 299,500 395,500
FUND BALANCE
NON-SPENDABLE: INVENTORIES 6,000 6,000
RESTRICTED FOR OTHER PURPOSES 16,000 16,000
UNASSIGNED 127,500 127,500
TOTAL FUND BALANCE 133,500 16,000 149,500
TOTAL LIABILITIES AND FUND
BALANCE 226,000 19,500 245,500
NET POSITION:
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-2
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-3.
TRINITY PARISH FIRE DISTRICT
GOVERNMENTAL FUNDS: STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES / STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31, 2020
ADJUSTMENTS
SPECIAL TO
GENERAL REVENUE GOVERNMENT STATEMENT
REVENUES FUND FUND TOTAL -WIDE OF ACTIVITIES
PROPERTY TAXES $ 320,000 320,000 (3,000)* 317,000
INTERGOVERNMENTAL 28,000 19,500 47,500 47,500
MISCELLANEOUS 5,000 5,000 5,000
TOTAL REVENUES 353,000 19,500 372,500 (3,000) 369,500
EXPENDITURES/EXPENSES
CURRENT
PERSONNEL SERVICES 150,000 15,000 165,000 165,000
SUPPLIES 25,000 - 25,000 25,000
DEPRECIATION 65,000 65,000
CAPITAL OUTLAY 125,000 - 125,000 (125,000) -
DEBT SERVICE
PRINCIPAL 5,000 5,000 (5,000) -
INTEREST 8,000 8,000 8,000
TOTAL EXPENDITURES 313,000 15,000 328,000 (65,000) 263,000
REVENUES OVER EXPENDITURES 40,000 4,500 44,500
* DEFERRED INFLOWS FROM PROPERTY TAXES FOR 2020 INCLUDED IN GOVERNMENT-WIDE FOR 2020 $ 36,000
DEFERRED INFLOWS FROM PROPERTY TAXES FOR 2019, PREVIOUSLY INCLUDED IN GOVERNMENT-WIDE (39,000)
NET DECREASE IN PROPERTY TAX REVENUE (3,000)
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-3
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9.4. SPECIAL ASSESSMENTS MAY BE EITHER SERVICE TYPES OR CONSTRUCTION TYPES. SERVICE-
TYPE SPECIAL ASSESSMENTS, SUCH AS AN ASSESSMENT TO DOWNTOWN BUSINESSES FOR SPECIAL
GARBAGE REMOVAL OR POLICE PROTECTION, WOULD BE ACCOUNTED FOR IN THE APPROPRIATE
FUND, OFTEN THE GENERAL OR A SPECIAL REVENUE FUND.
9-5.
TOWN OF EDEN BEACH
DEBT SERVICE FUND – SPECIAL ASSESSMENT DEBT
GENERAL JOURNAL
2020 DEBITS CREDITS
DEFERRED INFLOW – PROPERTY TAXES 150,000
SPECIAL ASSESSMENT REVENUE 150,000
CASH 150,000
SPECIAL ASSESSMENT TAX RECEIVABLE 150,000
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-4
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-6. AT THE INCEPTION OF THE LEASE, THE PRESENT VALUE OF THE MINIMUM LEASE PAYMENTS
SHOULD BE REPORTED AS A CAPITAL EXPENDITURE AND AN OTHER FINANCING SOURCE WITHIN AN
APPROPRIATE GOVERNMENTAL TYPE FUND (TYPICALLY THE GENERAL FUND OR A CAPITAL
PROJECTS FUND). RENTAL PAYMENTS WOULD TYPICALLY BE REPORTED AS INTEREST AND
PRINCIPAL EXPENDITURES IN THE GENERAL FUND OR A DEBT SERVICE FUND.
AT FISCAL YEAR END, THE LEASE ASSET SHOULD BE REFLECTED IN THE GOVERNMENT-WIDE
STATEMENT OF NET POSITION AS AN INTANGIBLE (CAPITAL) ASSET AT NET BOOK VALUE (I.E.
THE PRESENT VALUE OF THE MINIMUM LEASE PAYMENTS AT THE INCEPTION OF THE LEASE
LESS ACCUMULATED DEPRECIATION). SIMILARLY, THE UNPAID BALANCE OF THE LEASE
LIABILITY SHOULD BE REPORTED IN THE GOVERNMENT-WIDE STATEMENT OF NET POSITION
AS A LIABILITY.
9-7. (1)
CITY OF MOUNT ROGERS
WATER DEPARTMENT ENTERPRISE FUND
GENERAL JOURNAL
DEBITS CREDITS
1/1/17
LEASE ASSET 55,560
LEASE LIABILITY 43,560
CASH 12,000
12/31/17
INTEREST EXPENSE (4% * 43,560) 1,742
LEASE LIABILITY 10,258
CASH 12,000
12/31/17
DEPRECIATION EXPENSE (55,560 / 5) 11,112
ACCUMULATED DEPRECIATION 11,112
2. THE 2020 STATEMENT OF CASH FLOWS WOULD REPORT THE TWO PAYMENTS OF $ 12,000
OUTFLOW AS A CAPITAL RELATED FINANCING ACTIVITY AND THE $ 43,560 WOULD BE REPORTED
AMONG THE NON-CASH INVESTING AND FINANCING ACTIVITIES, TYPICALLY DISCLOSED AT THE
BOTTOM OF THE STATEMENT.
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-5
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-8 (1)
CITY OF GENOA
GENERAL JOURNAL
DEBITS CREDITS
GENERAL FUND 7/1/2019
EXPENDITURES-INTEREST 1,330
EXPENDITURES-PRINCIPAL 6,170
CASH 7,500
(Interest = $26,595 x .05 = $1,330. Principal = $7,500 – $1,330 = $6,170)
9-8 (B)
THE FIXED ASSET AND LONG-TERM LIABILITY ASSOCIATED WITH THIS CAPITAL LEASE
AGREEMENT WOULD BOTH BE REPORTED IN THE GOVERNMENT-WIDE STATEMENTS. AS OF
JULY 1, 2019, THE LEASE ASSET WOULD BE RECORDED IN THE AMOUNT OF $34,095.
ANNUAL AMORTIZATION WOULD BE BASED ON THAT AMOUNT. ON JULY 1, 2019, A LONG-
TERM LEASE LIABILITY WOULD BE RECORDED IN THE AMOUNT OF $26,595. ON JULY 1,
2020, THE LIABILITY WOULD BE REDUCED BY $6,170 TO $20,425.
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-6
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-9
1. A DEFINED CONTRIBUTION PLAN IS A PENSION PLAN IN WHICH THE BENEFITS ARE LIMITED
TO THE CONTRIBUTIONS MADE BY EMPLOYERS AND EMPLOYEES PLUS INVESTMENT INCOME.
NO CERTAIN AMOUNT OF BENEFITS ARE GUARANTEED; BUT ARE DETERMINED BY
CONTRIBUTIONS AND THE INVESTMENT PERFORMANCE OF ACCUMULATED FUNDS. AS A
RESULT, DEFINED CONTRIBUTION PLANS DO NOT HAVE UNFUNDED LIABILITIES. EMPLOYER
REPORTING IS MUCH SIMPLER: THERE IS NO NEED FOR ACTUARIAL CALCULATIONS SINCE
THE PENSION EXPENDITURE/EXPENSE EQUALS THE AMOUNT FUNDED.
A DEFINED BENEFIT PLAN, ON THE OTHER HAND, IS A PLAN THAT IS REQUIRED TO PAY A
CERTAIN MONTHLY AMOUNT FOR THE RETIREE’S REMAINING LIFETIME. THE AMOUNT OF
MONTHLY BENEFIT IS NORMALLY BASED ON AVERAGE EARNINGS AND LENGTH OF SERVICE.
FOR EXAMPLE, A PLAN MAY PAY TWO PER CENT OF EARNINGS TIMES THE AVERAGE OF THE
HIGHEST FOUR CONSECUTIVE YEARS, TIMES THE NUMBER OF YEARS' SERVICE. THIS
PAYMENT IS DUE, REGARDLESS OF THE AMOUNT AVAILABLE IN THE PENSION PLAN. AS A
RESULT, IT IS NECESSARY TO USE ACTUARIAL METHODS TO DETERMINE IF A DEFINED
BENEFIT PLAN HAS AN UNFUNDED ACTUARIAL LIABILITY. DEFINED BENEFIT PLANS REQUIRE
MORE DISCLOSURE IN FINANCIAL REPORTS THAN DO DEFINED CONTRIBUTION PLANS.
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-7
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-10
AMHERST CITY
ELECTRIC UTILITY
GENERAL JOURNAL
DEBITS CREDITS
PENSION EXPENSE (260,000+170,000-190,000) 240,000
NET PENSION LIABILITY 240,000
9-11
1. OTHER POSTEMPLOYMENT BENEFITS (OPEB) ARE RETIREE BENEFITS OTHER THAN PENSIONS
AND INCLUDE HEALTH CARE, DISABILITY, LONG-TERM (I.E. NURSING HOME) CARE, AND LIFE
INSURANCE.
2. FINANCIAL STATEMENTS PREPARED USING THE ECONOMIC RESOURCES MEASUREMENT
FOCUS AND ACCRUAL BASIS OF ACCOUNTING MUST REPORT A LIABILITY EQUAL TO THE NET
OPEB LIABILITY. LIKE PENSIONS, THE NET LIABILITY IS THE ACTUARIALLY COMPUTED
PRESENT VALUE OF PROJECTED BENEFIT PAYMENTS LESS THE ASSETS CURRENTLY
AVAILABLE IN THE PLAN TO MEET THOSE OBLIGATIONS. FOR MANY GOVERNMENTS, THERE
ARE NO ASSETS CURRENTLY AVAILABLE AND THE NET LIABILITY WILL EQUAL THE TOTAL
PROJECTED OPEB LIABILITY.
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-8
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-12. (A). SOLUTIONS TO THE EXCEL BASED EXERCISES ARE ALSO AVAILABLE IN EXCEL ON
THE INSTRUCTOR’S WEBSITE
DEBITS CREDITS
A CAPITAL ASSETS 21,050,000
ACCUMULATED DEPRECIATION 5,770,000
NET POSITION 15,280,000
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9-9
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-12 (B)
CHEROKEE LIBRARY DISTRICT
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES / STATEMENT OF ACTIVITIES
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED DECEMBER 31, 2020
ADJUSTMENTS
CAPITAL TOTAL TO
GENERAL PROJECTS GOVERNMENTAL GOVERNMENT- STATEMENT
FUND FUND FUNDS WIDE OF ACTIVITIES
REVENUES
PROPERTY TAXES $ 20,205,519 20,205,519 $ 1,200 $ 20,206,719
INTERGOVERNMENTAL REVENUES 2,269,751 145,801 2,415,552 2,415,552
INVESTMENT INCOME:
INTEREST INCOME 461,684 461,684 461,684
NET INCREASE IN FAIR VALUE OF INVESTMENTS 161,691 161,691 161,691
TOTAL REVENUES 23,098,645 145,801 23,244,446 1,200 23,245,646
EXPENDITURES / EXPENSES
CURRENT:
PUBLIC SERVICES 14,032,711 14,032,711 14,032,711
LIBRARY MATERIALS 5,474,632 5,474,632 5,474,632
DEPRECIATION 434,000 434,000
CAPITAL OUTLAY 453,033 7,539,481 7,992,514 (7,992,514) -
DEBT SERVICE - -
PRINCIPAL 1,340,000 1,340,000 (1,340,000) -
INTEREST 830,904 830,904 830,904
TOTAL EXPENDITURES 22,131,280 7,539,481 29,670,761 (8,898,514) 20,772,247
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
9-20
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
9-12 (C)
CHEROKEE LIBRARY DISTRICT
BALANCE SHEET / STATEMENT OF NET POSITION
GOVERNMENTAL FUNDS
AS OF DECEMBER 31, 2020
ADJUSTMENTS
CAPITAL TOTAL TO
PROJECTS GOVERNMENTAL GOVERNMENT- STATEMENT OF
GENERAL FUND FUND FUNDS WIDE NET POSITION
ASSETS
CASH $ 11,034,232 $ 4,825,591 $ 15,859,823 $ 15,859,823
INVESTMENTS 683,722 683,722 683,722
TAXES RECEIVABLE -
GROSS 131,534 131,534 131,534
INTEREST RECEIVABLE 2,487 2,487 2,487
PREPAID ITEMS 596,901 596,901 596,901
CAPITAL ASSETS - 29,042,514 29,042,514
ACCUMULATED
DEPRECIATION - (6,204,000) (6,204,000)
TOTAL ASSETS $ 12,448,876 $ 4,825,591 $ 17,274,467 $ 22,838,514 $ 40,112,981
Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities
FUND BALANCES
NON-SPENDABLE
PREPAID ITEMS 596,901 596,901
ASSIGNED -
LIBRARY PURCHASES 585,220 585,220
CAPITAL PROJECTS 4,241,200 4,241,200
UNASSIGNED 9,894,685 9,894,685
TOTAL FUND
BALANCES 11,076,806 4,241,200 15,318,006
NET POSITION
NET INVESTMENT IN CAPITAL ASSETS 7,048,732
UNRESTRICTED 15,671,788
$ 22,720,520
Copyright ©2020 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
9-22