Part I. The city council of Gandy, WI, population 301,277, passed its 2018 fisca

Question

Part I. The city council of Gandy, WI, population 301,277, passed its 2018 fiscal year budget (July 1, 2017 to June 30, 2018). Gandy has a high unemployment rate for Wisconsin, as a major manufacturing plant shut down and moved to lower-costing Texas. For fiscal year 2017, Gandy closed the fiscal year with an operating deficit of $590,000. Fund Balance--Unassigned at June 30, 2017 before applying the operating deficit, was $965,000. Gandy has the following FY 2018 budget adoption information Estimated Revenues: Property Taxes Fines and Forfeits Charges for Services Miscellaneous Revenues S 1,214,000 108,000 389,600 119,000 Totals S 1,830,600 Appropriations: Education Public Safety Public Works General Government 839,600 1,425,000 633,700 1,879,000 Totals S 4,777,300 Estimated Other Financing Sources Transfers from State of WI Proceeds from bond issue S 3,645,300 1,000,000 4,645,300

Explanation / Answer

Gandy cannot adopt this budget because there is huge expenditures not in commensuration with their revenues. They should try to reduce therir expenditures and increase revenue to strike balance between both. It is a deficit budget with revenues less than apportionments. General Government expenditures should be restricited, in the current year, government is unable to meet its current expenditures with their current revenues

Estimated Revenue $ 1,830,600.00 Estimated other financing sources $ 4,645,300.00 $ 6,475,900.00 Apportionments $ 4,777,300.00 Estimated other financing uses $ 2,050,000.00 $ 6,827,300.00 Deficit $      351,400.00 Journal Entry Particulars Debit Credit Estimated Revenue $ 6,475,900.00 Budgetry Fund Balance $      351,400.00 Estimated Apportions $ 6,827,300.00

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