ACCT 321 SEU Government Non Profit Accounting Questions 1. These transactions relate to Metro Bus, which provides transportation services to residents of P

ACCT 321 SEU Government Non Profit Accounting Questions 1. These transactions relate to Metro Bus, which provides transportation services to residents of Parker County. Metro Bus is accounted for as a County Enterprise Fund. Make journal entries to account for the following 2013 transactions in the Enterprise Fund.

2. Explain Financial Reporting Objectives of federal government

3. Malaz Township decides to construct a new city hall. Based on the following data, prepare a statement of revenues, expenditures, and changes in fund balance for Malaz Township’s Capital Projects Fund. All transactions occur within the calendar year 2013.

4. The following data comes from the 2013 financial statements of the Village of Matthews. Although presented in summarized format, the balance sheet debits and credits are equal and the operating statement information is complete.

5. A New employee of the city of Kashime was working with the accounting records of several of its funds. This employee, John Fergie, found that a gift had been given to the city for the library. The gift mandated that only the earnings from the gift could be used for library operations. John wanted to setup a Permanent Fund for the principal of the donation to the library and use a Special Revenue Fund to account for the earnings of the investment and their use. Another employee argued that a Private Purpose Trust Fund should be used for both, principal and income.

Required:

Do you agree with either of these individuals?
Do you have a better suggestion? College of Administrative and Financial Sciences
Assignment III
Deadline: 11 /04/ 2020 @ 23:59
Course Name: Government and Non-Profit
Accounting
Student’s Name:
Course Code: ACCT 321
Student’s ID Number:
Semester: 2
CRN:
Academic Year: 1440/1441 H
For Instructor’s Use only
Instructor’s Name:
Students’ Grade: …… /10
Level of Marks: High/Middle/Low
Instructions – PLEASE READ THEM CAREFULLY
The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
• Assignments submitted through email will not be accepted.
• Students are advised to make their work clear and well presented, marks may be reduced
for poor presentation. This includes filling your information on the cover page.
• Students must mention question number clearly in their answer.
• Late submission will NOT be accepted.
• Avoid plagiarism, the work should be in your own words, copying from students or other
resources without proper referencing will result in ZERO marks. No exceptions.
• All answered must be typed using Times New Roman (size 12, double-spaced) font. No
pictures containing text will be accepted and will be considered plagiarism).
• Submissions without this cover page will NOT be accepted.
Assignment Question(s):
(Marks. 10)
1. These transactions relate to Metro Bus, which provides transportation services to
residents of Parker County. Metro Bus is accounted for as a County Enterprise Fund.
Make journal entries to account for the following 2013 transactions in the Enterprise Fund.
a. On April 1, 2013, Metro borrows $3,000,000 by issuing 10-year revenue bonds.
Bond principal is to be paid back in 20 equal semi-annual installments, starting
October 1, 2013, together with interest of 6% a year on the unpaid principal.
b. On July 1, Metro pays cash for 10 buses costing $150,000 each. Metro also pays
cash for land costing $100,000 and a building costing $900,000 to house its repair
activity.
c. On July 1, Metro invests $200,000 of unused cash in a Certificate of Deposit
(CD).
d. Metro pays cash of $50,000 to acquire an inventory of repair parts.
e. Metro collects bus fares of $900,000, which it deposits in the bank.
f. Metro sends an invoice for $10,000 to the County Social Services Agency for
taking senior citizens on bus tours. The Agency receives appropriations from the
General Fund.
g. Metro pays salaries of $500,000 to its bus operators, mechanics, and
administrative staff.
h. The CD (transaction c.) matures and Metro receives a check for $203,000.
i. On October 1, 2013, Metro pays the first installment of principal and interest on
the revenue bonds in transaction a.
To prepare financial statements at December 31, 2013, Metro makes adjusting journal entries for the
following items:
j. To record six months’ depreciation on the buses and building bought in transaction
b. Estimated lives are: buses – 10 years; building – 30 years.
k. To record consumption of repair parts. A year-end physical inventory shows repair
parts on hand amounting to $8,000. (See transaction d.)
l. To accrue for unpaid salaries of $12,000.
m. To accrue interest on the revenue bonds outstanding at December 31, 2013. (See
transactions a. and i.)
2. Explain Financial Reporting Objectives of federal government
3. Malaz Township decides to construct a new city hall. Based on the following data, prepare a
statement of revenues, expenditures, and changes in fund balance for Malaz Township’s Capital
Projects Fund. All transactions occur within the calendar year 2013.
a.
The Fund starts and ends the year with a zero fund balance.
b.
The Fund’s financing sources for the city hall project were: long-term bond proceeds – $6
million; operating transfer from the General Fund – $2 million; state grant – $1.5 million;
interest from the temporary investment of cash – $90,000.
c.
Total outlays for constructing the new city hall were: construction costs – $8,250,000;
design and construction supervision fees – $600,000.
City laws require that, whenever bonds are used, any remaining difference between total
financing sources and construction costs must be transferred to the Debt Service Fund.
Therefore, $740,000 was transferred to the Debt Service Fund.
d.
Answer
Q4. The following data comes from the 2013 financial statements of the Village of Matthews. Although
presented in summarized format, the balance sheet debits and credits are equal and the operating
statement information is complete.
General Fund – Balance Sheet Elements
Cash
$1,200,000
Short-term investments
405,000
Property taxes receivable – delinquent
282,000
Due from other funds
Accounts payable and other accrued liabilities
Assigned fund balance
Unassigned fund balance
58,000
900,000
90,000
935,000
General Fund – Operating Statement Elements
Revenues, including property taxes of $6,125,000
Expenditures (total)
Transfer to Debt Service Fund
$8,350,000
7,510,000
400,000
Excess of revenues and other sources over expenditures
and other uses
440,000
Debt Service Fund – Balance Sheet Elements
Cash and cash equivalents
230,000
Restricted fund balance
230,000
Debt Service Fund – Operating Statement Elements
Debt service expenditures:
Principal
100,000
Interest
200,000
Operating transfer from General Fund
400,000
Excess of revenues and other sources over
expenditures and other uses
100,000
Required: Calculate the following ratios for the Village of Matthews:
a. Current ratio – General Fund
b. Quick ratio – General Fund
c. Property tax receivable delinquency rate
d. Budgetary cushion for the General Fund (Assume all assigned fund balance is
available.)
e. Debt service burden
f. Excess of revenues and other sources over expenditures and other uses, as a
percentage of revenues – Combined, General Fund and Debt Service Fund (Hint: The transfers
out and in cancel each other. Therefore, use the revenues for the denominator.)
Answer:
Q5. A New employee of the city of Kashime was working with the accounting records of
several of its funds. This employee, John Fergie, found that a gift had been given to the
city for the library. The gift mandated that only the earnings from the gift could be used
for library operations. John wanted to setup a Permanent Fund for the principal of the
donation to the library and use a Special Revenue Fund to account for the earnings of the
investment and their use. Another employee argued that a Private Purpose Trust Fund
should be used for both, principal and income.
Required:
1- Do you agree with either of these individuals?
2- Do you have a better suggestion?

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