ACCT 321 SEU Week 6 Government and Non Profit Accounting Income Statement Discussion
Need help with my Accounting question – I’m studying for my class.
Q1. State whether these statements are true or false.Discuss why the false statements are false.
a.An entity is likely to be a governmental entity if a controlling majority of its governing body is appointed by governmental officials.
b.The objective of a government is to provide services to its constituents.
c.AICPA pronouncements have approximately the same level of authority as articles appearing in the Journal of Accountancy.
d.The objective of a not-for-profit organization is to provide services to its constituents.
e.By definition, all funds have cash, financial resources, and capital resources.
f.The objective of a business organization is to enhance the wealth of its owners.
Q2. A department of a local government began operations at the beginning of the current fiscal year with $250,000 cash.During the fiscal year, the department made cash disbursements for the following:
#Salaries and other personnel costs, $100,000
#Office rent and utilities, $24,000
#Retirement of debt principal, $10,000; payment of interest, $2,200
#Purchased equipment at the beginning of the fiscal year for $30,000; the equipment is expected to last 6 years and have a salvage value of $6,000
#Photocopier rental, $10,500
Based on the preceding transactions, compute total annual expenditures for this department assuming it performs governmental-type activities and is accounted for in the General Fund.
Then compute total annual expenses for this department assuming it performs activities within an Enterprise Fund.
Q3. The council of the Town of Tulia approved the 2013 budget as follows:
Budgeted 2013 revenues from:
Property taxes$5,000,000
Sales taxes$1,000,000
Appropriations for 2013:
Salaries$4,600,000
Materials$1,200,000
Equipment$100,000
During 2013, the town’s mayor presented the council with a budget revision to increase the amount of appropriation for salaries by $10,000.The council approved this budget revision.
Required:
a.Prepare the general journal entry necessary to initially record the budget.
b.Prepare the general journal entry necessary to record the budget revision.
