Question

The following transactions occurred for the City of Forest Green's General Fund.

1. The budget prepared for the fiscal year included total estimated revenues of $2,774,000 and appropriations of $2,693,000.
2. Encumbrances issued against the appropriations during the year were $931,000.
3. The current year’s tax levy of $2,005,000 was recorded; uncollectibles were estimated as $65,000.
4. Collections of delinquent taxes from prior years’ levies totaled $132,000; collections of the current year’s levy totaled $1,459,000.
5. Invoices were received and approved for payment for items ordered in documents recorded as encumbrances in transaction (2) of this problem. The estimated liability was $851,200. Actual costs were $850,500.
6. Revenue other than taxes collected during the year consisted of licenses and permits, $373,000; intergovernmental revenue, $400,000; and $66,000 of miscellaneous revenues.
7. Payments on Vouchers Payable totaled $1,505,000.

Prepare the journal entries for the General Fund. Governmental activities and closing entries are not required. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

The City of Forest Green's General Fund journal entries include recording the budget, encumbrances, tax levies and collections, and payments on vouchers. These entries ensure that the Fund's financial transactions are reflected in accordance with governmental accounting principles.

Step-by-step explanation:

The City of Forest Green's General Fund journal entries for the given transactions would be as follows:

Record the budget: Dr. Estimated Revenues 2,774,000; Cr. Appropriations 2,693,000; Cr. Budgetary Fund Balance 81,000.

Record encumbrances: Dr. Encumbrances 931,000; Cr. Budgetary Fund Balance Reserved for Encumbrances 931,000.

Record property taxes levied and an allowance for uncollectible taxes: Dr. Taxes Receivable - Current 2,005,000; Cr. Revenues 2,005,000; Dr. Allowance for Uncollectibles - Current 65,000; Cr. Revenues - Uncollectible Current Taxes 65,000.

Record collections of delinquent taxes and current taxes: Dr. Cash 1,459,000; Dr. Delinquent Taxes Receivable - Prior 132,000; Cr. Revenues - Delinquent Taxes 132,000; Cr. Taxes Receivable - Current 1,459,000.

Record invoices for items previously encumbered: Dr. Encumbrances 931,000; Cr. Budgetary Fund Balance Reserved for Encumbrances 931,000; Dr. Expenditures 850,500; Cr. Vouchers Payable 850,500.

Record other revenues collected: Dr. Cash 839,000; Cr. Revenues from Licenses and Permits 373,000; Cr. Intergovernmental Revenues 400,000; Cr. Miscellaneous Revenues 66,000.

Record payments on vouchers: Dr. Vouchers Payable 1,505,000; Cr. Cash 1,505,000.

Each journal entry accurately reflects the corresponding financial transaction and aligns with the principles of fund accounting as employed by government entities. Closing entries are not required for this exercise.