The Black Hole, a unit of the Space Department, was established October 1, 2013. Its purpose is to probe deep space. It is financed by an appropriation from Congress. Following are the transactions of the agency during October 2013:

October 1 The agency received a certified copy of an appropriation warrant from the Department of the Treasury for $ 900,000.

October 1 The entire appropriation of $ 900,000 was apportioned by the OMB.

October 1 Of the amount apportioned, $ 400,000 was allotted to the agency by the Space Department to finance its October operations.

October 4 The agency ordered special training equipment at an estimated cost of $ 275,000.

October 14 The equipment arrived, together with an invoice for $ 300,000. The equipment was accepted at the price charged, because the contract permitted a 10 percent cost overrun.

October 24 The agency sent a disbursement schedule to Treasury requesting payment of the following items. (The agency does not obligate salaries or utility bills but maintains off- line controls to ensure allotments are not exceeded.)

Equipment....... $ 300,000

Salaries....... 75,000

Utilities....... 20,000

October 27 Treasury notified the agency that all items on the disbursement schedule had been paid.

October 31 The agency recorded depreciation of $ 5,000 on the equipment. Use the preceding information to do the following:

a. Prepare journal entries to record these transactions and events.

b. Prepare a preclosing trial balance.

c. Prepare a balance sheet, a statement of net costs, and a statement of changes in net position.