Central Station Fund. The Town of Elizabeth operates the old train station as an enterprise fund. The train station is on the national register of historic buildings. Since the town has held the building for such a long time, the Central Station Fund has no long-term debt. The only capital assets recorded by the Central Station Fund are machinery and equipment. Businesses rent space in the building and the town provides all services related to the operation and maintenance of the building. Following is information related to the fund’s 2011 operating activities.
1. Rental income of $94,444 was accrued. Subsequently, cash in the amount of $90,210 was received on accounts.
2. Cash expenses for the period included: administrative services, $25,205; maintenance and repairs, $72,882; supplies and materials, $7,792; and utilities, $30,124.
3. The Central Station Fund received a $60,000 transfer of funds from the General Fund.
4. Adjustments were made for depreciation ($3,519) and for uncollectible accounts ($667).
5. At the end of the period, nominal accounts were closed.
Required:
a. Prepare general journal entries to record the Central Station Fund’s operating activities for the year.
b. Prepare a statement of revenues, expenses, and changes in fund net assets. The net asset balance at the beginning of the period was $60,129,
c. Based on the information provided does it appear that the Central Station Fund is required to be recognized as an enterprise fund under GASB standards” Explain your answer.
d. Assuming you are the town’s manager, discuss your concerns about the Central Station Fund.