Part 1: Research the following statements and write a paper of 500 words on your findings:
- What are the key differences between a governmental unit and a commercial company?
- Discuss the following terms and how they are used during the budget process of a governmental unit:
- Budgetary fund balances
- Give examples for each of the above terms.
Part 2: Given the following information, create the journal entries required for each of the situations described:
Estimated revenues Property taxes $1,250,000 Fines and forfeits 80,000 Intergovernmental 500,000 Total $1,830,000 Appropriations General $300,000 Streets 50,000 Public safety 800,000 Total $ 1,150,000
- Make the journal entry to record the adoption of the annual budget.
- Make the journal entries necessary to record the following cash revenues that were received:
Property taxes $800,000 Fines and forfeits 73,000 Intergovernmental 300,000 Total $1,173,000
- Purchase orders were issued for the following goods and services:
General $285,000 Streets 50,000 Public safety 670,000 Total $ 1,005,000
- Purchase orders were fulfilled based upon the following estimated and actual costs:
Estimated Actual General $285,000 $280,000 Streets 50,000 50,000 Public safety 670,000 660,000 Total $ 1,005,000