A city orders a new computer for its General Fund at an anticipated cost of $94,

Question

A city orders a new computer for its General Fund at an anticipated cost of $94,700. Its actual cost when received is $96,880. Payment is subsequently made.

Prepare all required journal entries for both fund (General Fund) and government-wide (Governmental Activities) financial statements. Prepare the entries for the government-wide financial statements first. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

1. Record orders placed for computers - Governmental Activities.

2. Record actual cost of computers - Governmental Activities.

3. Record payment made for computers - General Fund.

4. Record entry to remove encumbrance for computers that has now been received - General Fund.

5. Record the receipt of computers and the accompanying liability - General Fund.

6. Record payment made - General Fund.

A city orders a new computer for its General Fund at an anticipated cost of $94,700. Its actual cost when received is $96,880. Payment is subsequently made.

Explanation / Answer

(A.) Fund-Based Financial Statements-General Funds Encumbrances Control 94,700 Fund Balance-Reserve for Encumbrances 94,700 Expenditures - Computer 96,880 Voucher Payable 96,880 Fund Balance-Reserve for Encumbrances 94,700 Encumbrace control 94,700 Vouchers Payable 96,880 Cash 96,880 (B.) Government-Wide Financial Statements-Governmental Activities No entry at this time… Computer 96,880 Vouchers Payable 96,880 Vouchers Payable 96,880 Cash 96,880

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