Problem Trial Balance Adjustments General Fund Endowment Fund 19-1

Transcription

1 Problem 19 2 Trial Balance Adjustments General Fund Endowment Fund Plant Replacement Fund Account Description Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit $ $ Investment in U.S. Treasury Bills 105,000 $105,000 Investment in Common Stock 417,000 $ 417,000 Interest Receivable 4,000 4,000 Accounts Receivable 40,000 40,000 Inventory 25,000 25,000 Land 407,000 (2)$385,000 22,000 Building 245,000 (3)$100, ,000 Equipment 283, ,000 Allowance for Depreciation 37 (4) $62,000 $438,000 Accounts Payable 70,000 70,000 Bank Loan 1 1 Endowment Fund Balance 119,500 (1) 14,500 $105,000 Other Fund Balances 860,500 (2) 385,000 (1) 14,500 (4) 62,000 (3) 100,000 (5) 528,000 Plant Replacement Fund Balance (5) 417,000 $417,000 General Fund Balance (5) 111, ,000 Totals $1,57 $1,57 $1,089,500 $1,089,500 $769,000 $769,000 $105,000 $105,000 $417,000 $417,

2 Problem 19 2 (continued) Adjusting Entries (not required) (1) Endowment Fund Balance Other Fund Balances To eliminate from the Endowment Fund Balance the investment income earned on U.S. Treasury Bills (2) Other Fund Balance Land To eliminate from the land account the $380,000 appraisal increase and the $5,000 cost of the old building which was demolished. (3) Building Other Fund Balance To eliminate the appraisal decrease and restate the hospital building at its actual cost. (4) Other Fund Balances Allowance for Depreciation To correct the allowance for depreciation through December 31, 2008 in accordance with the following computation: Building - $300,000 at 2% times 41 years Elevator - $45,000 at 5% times 15 years Equipment ascertained to be accurate Total accumulated depreciation, as computed Less accumulated depreciation per books Understatement of accumulated depreciation (5) Other Fund Balances Plant Replacement Fund General Fund To close out Other Fund Balances and to allocate its balance to the General Fund and the Plant Replacement Fund. 14, , ,000 62,000 $24 33, , , $62, ,000 14, , ,000 62, , ,

3 Problem 19 3 CENTURY UNIVERSITY Transactions for the Year Ended June 30, 2008 Part A Current Funds Unrestricted Restricted Endowment Fund Account Debit Credit Debit Credit Debit Credit (1) Contribution To record receipt of cash gift for purchase of books Contribution To record receipt of cash gift to establish scholarship fund Investment in Savings Certificates To record purchase of savings certificates (2) Deferred Accounts Receivable To record tuition and fees revenue Deferred To record deferred revenue at June 30, 2008 (3) Allowance for Uncollectible Accounts Accounts Receivable (4) To record interest earned on late student fee payments 1, , , ,000 1,000 1,900, ,

4 Problem 19 3 (continued) Current Funds Unrestricted Restricted Endowment Fund Account Debit Credit Debit Credit Debit Credit (5) State Appropriation Receivable 75,000 State Appropriation Receivable To record receipt of regular appropriation and to record additional appropriation 75,000 (6) To record receipt of unrestricted gift 25,000 25,000 (7) Investment Fund Balance To record sale of investments Investment Income To record income earned on investments 2 1,900 21,000 5,000 1,900 (8) Expenses Accounts Payable 1,777,000 59,000 1,718,000 (9) Expenditures To record payment of authorized expenditures Fund Balance To record as revenue amounts expended for restricted purposes 19-4

5 Problem 19 3 (continued) Current Funds Endowment Fund Unrestricted Restricted Account Debit Credit Debit Credit Debit Credit (10) Accounts Payable 45,000 45,000 (11) Due to Current Restricted Fund To record receipt of interest income on savings certificates purchased by Endowment Fund 7,000 7,000 Due from Endowment Fund Fund Balance To record income due from Endowment Fund for Scholarships 7,000 7,000 Part B CENTURY UNIVERSITY Statement of Activities For the Year Ended June 30, 2008 Current Funds Unrestricted and additions: Unrestricted current fund revenues $1,981,000 Private gifts restricted Endowment income - restricted Realized gains on investments restricted Investment income restricted Total revenue & additions $1,981,000 Restricted $ 7,000 5,000 1,900 $63,900 Endowment Fund $ $0 Expenditures: Educational & general Total expenditures $1,780,000 $1,780,000 $ $ 0 Net increase for the year Fund balance at beginning of year Fund balances at end of year 201, ,000 $71 50,900 67,000 $117,900 0 $ 19-5

6 Problem 19 3 (continued) Part C and additions: Tuition and fees State appropriations Private gifts and grants Interest on deferred tuition Total current revenue Expenditures: Educational and general Total expenditures CENTURY UNIVERSITY Statement of Activities For the Year Ended June 30, 2008 Current Funds Total Unrestricted Restricted $1,900,000 25,000 1,981,000 1,780,000 1,780,000 $ $1,900,000 38,000 1,994,000 1,780,000 1,780,000 Excess of restricted receipts over transfers to revenue 50,900 50,900 Net increase in fund balance $201,000 $50,900 $264,

7 Problem 19 4 Event Fund Journal Entry 1 Endowment Fund Brown 10,000 10,000 2 Endowment Fund Gross 20,000 20,000 3 Endowment Fund Norton 30,000 30,000 4 Annuity Fund -contribution Annuity Payable ($10, ) 205, ,891 81,109 5 Endowment Fund Jackson Investments (1,000)($150) 6A Endowment Fund Brown Investments (1/3)($30,000) 6B Endowment Fund Gross Investments (2/3)($30,000) 7 Endowment Fund Norton Investments 8 Annuity Fund Investments 1 10,000 20,000 30, , ,000 20,000 30, ,000 Interest computations ($30,000)(.12) = $3,, 1/3 of $3,, or $ to Brown, 2/3 of $3,, or $2,400 to Gross ($30,000)(.10)=$3,000 to Norton 19-7

8 Problem 19-4 (continued) Event Fund Journal Entry 9A1 Endowment Fund Brown Due to Unrestricted Current Fund 9A2 Unrestricted Current Fund Due from Endowment Fund Brown Investment Income 9B1 Endowment Fund Gross Due to Restricted Current Fund 9B2 Restricted Current Fund Due from Endowment Fund - Gross Investment Income 9C1 Endowment Fund - Norton Due to Loan Fund 9C2 Loan Fund Due From Endowment Fund - Norton Investment Income 9D Annuity Fund (8%)($200,000)/2 Annuity payable 8,000 8,000 9E Endowment Fund - Jackson Investment Income (BIM dividend) 4,000 4,000 9F1 Endowment Fund - Brown Due to Unrestricted Current Fund 9F2 Unrestricted Current Fund Due from Endowment Fund - Brown 9G1 Endowment Fund - Gross Due to Restricted Current Fund 9G2 Restricted Current Fund Due from Endowment Fund - Gross 19-8

9 Problem 19 4 (continued) Event Fund Journal Entry 9H1 Endowment Fund - Norton Due to Loan Fund 9H2 Loan Fund Due from Endowment Fund Norton 10 Annuity Fund Annuity Payable 10,000 10, Endowment Fund - Brown Investments Fund Balance 6,800 6, Endowment Fund - Gross Investments Fund Balance 13, 13, Loan Fund Loan Receivable Annuity Fund Annuity Payable Due to Unexpended Plant Fund 79, , ,000 Unexpended Plant Fund Due from Annuity Fund Fund Balance Restricted 203, , Restricted Current Fund (1) Expenses Scholarship

10 Problem 19 4 (continued) Event Fund Journal Entry 15 Annuity Fund Investment income Investments Annuity Fund Investment income) Due to unexpended plant fund Unexpended Plant Fund Due from annuity fund Fund balance restricted 16 Endowment Fund Norton (1A) Due to Loan Fund (1B) Due to Loan Fund Loan Fund (2A) Due from Endowment Fund - Norton Investment income ,000 Endowment Fund-Brown Unrestricted current fund Endowment Fund-Gross Restricted Current Fund - Gross (2B) Due from Endowment Fund Norton Due to unrestricted current fund Due from endowment fund - Brown Endowment income Due to restricted current fund Due from Endowment Fund - Gross Investment Income ** Note: These entries assume the cash due on January 1 was received on December Loan Fund Loan Receivable Interest income Annuity Fund (1) Due to Unexpended Plant Fund 209, ,

11 Problem 19 4 (continued) Unexpended Plant Fund (2) Due from Annuity Fund Mortgage Payable 2 209,000 41,000 (3) Building 2 2 (4) Fund Balance Restricted Mortgage Payable Building 209,000 41,000 2 Investment in Plant (5) Building Mortgage Payable Net Investment in Plant 2 41, ,

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