Question

Prepare journal entries for the City of Pudding's governmental funds to record the transactions listed below, first for fund financial statements and then for government-wide financial statements. Ensure clarity in your responses.

- A new truck for the sanitation department was ordered at a cost of $111,500.
- The city print shop did $1,800 worth of work for the school system (not yet paid).
- A $7 million bond was issued at face value to build a new road.
- The city transfers $157,000 cash from its general fund for a municipal swimming pool (enterprise fund).
- The truck ordered in (1) is received but at an actual cost of $113,900. Payment is not made at this time.
- The city transfers $37,200 cash from its general fund to a capital projects fund.
- The city receives a state grant of $50,000 for citizen recycling promotion.
- The first $9,000 of the state grant received in (7) is expended as intended.
Provide clear journal entries for each transaction.

Answer 1

This answer provides journal entries for the City of Pudding's governmental funds to record transactions for fund financial statements and government-wide financial statements.

Step-by-step explanation:

1. Debit: Trucks ($111,500) Credit: Vouchers Payable ($111,500)
2. Debit: Interfund Services Expenditures ($1,800) Credit: Due to Print Shop ($1,800)
3. Debit: Cash ($7,000,000) Credit: Bonds Payable ($7,000,000)
4. Debit: Intergovernmental Transfers-Out ($157,000) Credit: Cash ($157,000)
5. Debit: Trucks ($113,900) Credit: Vouchers Payable ($113,900)
6. Debit: Transfers Out-Other Funds ($37,200) Credit: Cash ($37,200)
7. Debit: Cash ($50,000) Credit: Grants Revenue ($50,000)
8. Debit: Expenditures ($9,000) Credit: Cash ($9,000)

1. Debit: Infrastructure ($113,900) Credit: Cash ($113,900)