Your firm is auditing the financial statements of the City of Mensah€™s Point for the year ended December 31, 20X4. You have been assigned to review a fund balance schedule to see if you can identify any likely errors in the fund balance section of the governmental funds balance sheet. The fund balance section, as prepared by the finance staff of the city, is presented below.

a. Identify any apparent misclassifications of fund balance and explain the basis for your opinion that the amounts are misclassified.
b. Draft a corrected fund balance schedule. State any assumptions made other than those you explained ina.

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General Streets Special Courthouse Capital Other Fund Revenue Fund Projects Fund Governmental Funds Total Fund Balances: Nonspendable Inventory Prepaid items 330 80 600 800 500 200 1,830 80 875 Long-term receivables 200 75 Restricted for: Street maintenance Courthouse expansion Debt service reserve Housing and Community 1,400 1,400 3,200 600 3,200 600 550 900 Development 550 Committed for: Economic development Contingencies Parks 400 700 1,300 700 300 300 Assigned for: Development City facility projects Budget stabilization Focused enhancement 220 300 1,500 300 1,500 initiatives Other purposes 1,000 1,000 350 1400 $15,605 100 250 (800) $6,210 $2,600 Unassigned Total fund balance $3,700 $3,095