Accounting For Governmental & Nonprofit Entities
18th Edition
ISBN: 9781259917059
Author: RECK, Jacqueline L., Lowensohn, Suzanne L., NEELY, Daniel G.
Publisher: Mcgraw-hill Education,
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Textbook Question
Chapter 5, Problem 18EP
Make all necessary entries in the appropriate governmental fund general journal and the government-wide governmental activities general journal for each of the following transactions entered into by the City of Loveland.
- 1. The city received a donation of land that is to be used by Parks and Recreation to develop a public park. At the time of the donation, the land had an acquisition value of $5,200,000 and was recorded on the donor’s books at a historical cost of $4,500,000.
- 2. The Public Works Department sold machinery with a historical cost of $35,100 and
accumulated depreciation of $28,700 for $6,000. The machinery had originally been purchased with special revenue funds. - 3. A car was leased for the mayor’s use. The first payment was $1,000 and the present value of the remaining lease payments was $29,000. (Note: The initial cash payment was made by the General Fund.)
- 4. During the current year, a capital projects fund completed a new public safety building that was started in the prior year. The total cost of the project was $9,720,000. Financing for the project came from a $9,000,000 bond issue that was sold in the prior year and from a $720,000 federal capital grant received in the current year. Current-year expenditures for the project totaled $1,176,000. The full cost is attributed to the building because it was constructed on city-owned property.
- 5. The city records a half year of straight-line depreciation on capital assets placed in service during the year. The building in item 4 above has an estimated 30-year life and no salvage value.
- 6. Due to technological developments, the city determined that the service capacity of some of the technology equipment used by general government had been impaired. The calculated impairment loss due to technology obsolescence was $1,156,000.
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Prepare journal entries for each of the following transactions entered into by the City of Loveland. (If no entry is required for a
transaction/event, select "No Journal Entry Required" in the first account field.)
Fund/ Governmental
Activties
Transaction
Debit
Credit
General Journal
1. The city received a donation of land that is to be used by Parks and Recreation to develop a public park. At the time of the donation, the land had an acquisition
value of $5,200,000 and was recorded on the donor's books at a historical cost of $4,500,000.
1
General Fund
2. The Public Works Department sold machinery with a historical cost of $35,100 and accumulated depreciation of $28,700 for $6,000. The machinery had
originally been purchased with special revenue funds.
2
General Fund
3b
3. A car was leased for the mayor's use. The first payment was $1,000 and the present value of the remaining lease payments was $29,000. (Note: The initial cash
payment was made by the General Fund.)
3a
General Fund
4a…
Analyze the following two scenarios. What are your recommendations?
A county was the recipient of a bequest. Land was donated to the county with the donor stipulating it could only be used for the new public safety facility. How would this contribution be reported in the county’s Statement of Activities?
3
During the year, a local merchant donated a building to the City of Stage Coach. The original cost of the building was $300,000.
Accumulated depreciation at the date of the gift amounted to $250,000. The acquisition value of the donation at the date of the
gift was $600,000. At what amount should this contribution be recorded in the governmental activities accounts at the
government-wide level?
Multiple Choice
$50,000.
$300,000.
$600,000.
$0.
Chapter 5 Solutions
Accounting For Governmental & Nonprofit Entities
Ch. 5 - What are general capital assets? How are they...Ch. 5 - Explain what disclosures the GASB requires for...Ch. 5 - Prob. 3QCh. 5 - Prob. 4QCh. 5 - Prob. 5QCh. 5 - What is the accounting difference between using...Ch. 5 - Prob. 7QCh. 5 - Prob. 8QCh. 5 - Prob. 9QCh. 5 - What is a service concession arrangement, and why...
Ch. 5 - Prob. 13CCh. 5 - Prob. 14CCh. 5 - Prob. 15CCh. 5 - Under GASB standards, which of the following would...Ch. 5 - Two new copiers were purchased for use by the city...Ch. 5 - Maxim County just completed construction of a new...Ch. 5 - A capital projects fund would probably not be used...Ch. 5 - Machinery and equipment depreciation expense for...Ch. 5 - Prob. 17.6EPCh. 5 - Prob. 17.7EPCh. 5 - Callaway County issued 10,000,000 in bonds at 101...Ch. 5 - Neighborville enters into a lease agreement for...Ch. 5 - Neighborville enters into a lease agreement for...Ch. 5 - Prob. 17.11EPCh. 5 - Prob. 17.12EPCh. 5 - Prob. 17.13EPCh. 5 - Arbitrage rules under the Internal Revenue Code a....Ch. 5 - Prob. 17.15EPCh. 5 - Make all necessary entries in the appropriate...Ch. 5 - Prob. 19EPCh. 5 - Prob. 20EPCh. 5 - In the current year, the building occupied by...Ch. 5 - Prob. 22EPCh. 5 - Make all necessary entries in a capital projects...Ch. 5 - The year-end pre-closing trial balance for the...Ch. 5 - Prob. 25EPCh. 5 - This year Riverside began work on an outdoor...
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