Using the format at the end of this exercise, indicate the impact that each of the following transactions has on the total net position of a proprietary fund and on each net position component. Also, indicate whether the transaction is reported in the statement of revenues, expenses, and changes in fund net position of a proprietary fund. A sample transaction is analyzed for you.
Sample Transaction: Purchase of equipment costing $5,000 with unrestricted cash.
1. Sold building with a book value of $150,000 for $225,000 (proceeds not restricted).
2. Land costing $500,000 was purchased by issuing a five-year, 8% note payable for $450,000.
The balance was paid from cash restricted for an expansion project.
3. Depreciation expense for the year was $200,000.
4. Interest expense of $36,000 on the note in transaction 2 was paid from unrestricted resources.
5. Bonds payable of $200,000 were repaid from restricted resources, along with $50,000 of interest. The bonds were issued several years earlier to finance capital asset construction.
6. A capital grant of $500,000 was received, but no qualifying costs have been incurred.
7. $300,000 of the restricted capital grant from transaction 6 was expended for its intended purpose.
8. Sales revenues amounted to $1,000,000.
9. Interest revenues restricted to the use of the Enterprise Fund, $40,000, were received.
10. The cost of materials and supplies used for the year was$75,000.

  • CreatedOctober 25, 2014
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