The City of Castleton’s General Fund had the following post-closing trial balance at June 30, 2022, the end of its fiscal year:

During the year ended June 30, 2023, the following transactions, in summary form, with subsidiary ledger detail omitted, occurred:

1. The budget for FY 2023 provided for General Fund estimated revenues totaling $3,140,000, appropriations totaling $3,000,000, and an other financing use—interfund transfer out of $100,000.

2. The city council authorized temporary borrowing of $500,000 in the form of a 120-day tax anticipation note obtained from a local bank.

3. The property tax levy for FY 2023 was recorded. Net assessed valuation of taxable property for the year was $43,000,000, and the tax rate was $5 per $100. It was estimated that 3 percent of the levy would be uncollectible.

4. Purchase orders and contracts were issued to vendors and others in the amount of $2,060,000.

5. $1,961,000 of current taxes, $103,270 of delinquent taxes, $3,570 of interest and penalties, and $11,000 of accrued sales taxes were collected. The delinquent taxes and associated interest and penalties were collected more than 60 days after the prior year-end.

6. Additional interest and penalties on delinquent taxes were accrued in the amount of $3,430, of which 30 percent was estimated to be uncollectible.

7. Because of a change in state law, the city was notified that it will receive $80,000 less in intergovernmental revenues than was budgeted.

8. Delinquent taxes of $12,792 were deemed uncollectible and written off. The associated interest and penalties of $952 also were written off.

9. Total payroll during the year was $819,490. Of that amount, $62,690 was withheld for employees’ FICA tax liability, $103,710 for employees’ federal income tax liability, and $34,400 for state taxes; the balance was paid to employees in cash.

10. The employer’s FICA tax liability was recorded for $62,690.

11. Cash collections from sales taxes totaled $825,000 and from revenue sources other than taxes were $110,000. In addition, sales taxes receivable due July 1 were accrued in the amount of $12,000.

12. Amounts due to the federal government as of June 30, 2023, and amounts due for FICA taxes and state and federal withholding taxes during the year were vouchered.

13. Purchase orders and contracts encumbered in the amount of $1,988,040 were filled at a net cost of $1,887,570, which was vouchered.

14. Vouchers payable totaling $2,101,660 were paid after deducting a credit for purchases discount of $8,030 (credit Expenditures).

15. The tax anticipation note of $500,000 was repaid. Interest totaled $10,000.

16. A transfer of $100,000 was made to establish a special revenue fund to account for expenditures related to a federal grant.

17. All unpaid current year’s property taxes became delinquent. The balances of the current taxes receivable and related uncollectibles were transferred to delinquent accounts. The City uses the 60-day rule for all revenues and does not expect to collect any delinquent property taxes or interest and penalties in the first 60 days of the next fiscal year.

18. A physical inventory of materials and supplies at June 30, 2023, showed a total of $9,100. Inventory is recorded using the purchases method in the General Fund; the consumption method is used at the government-wide level. 

Required

a. Record in general journal form the effect of the above transactions on the General Fund and governmental activities for the year ended June 30, 2023. Do not record subsidiary ledger debits and credits.

b. Record in general journal form entries to close the budgetary and operating statement accounts in the General Fund only. Do not close the governmental activities accounts.

c. Prepare a General Fund balance sheet as of June 30, 2023.

d. Prepare a General Fund statement of revenues, expenditures, and changes in fund balance for the year ended June 30, 2023. Do not prepare the government-wide financial statements.

Transcribed Image Text:

Cash Sales Taxes Receivable Taxes Receivable-Delinquent Allowance for Uncollectible Delinquent Taxes Interest and Penalties Receivable Allowance for Uncollectible Interest and Penalties Inventory of Supplies Vouchers Payable Due to Federal Government Deferred Inflows of Resources-Unavailable Revenues Fund Balance-Nonspendable-Inventory of Supplies Fund Balance-Unassigned Debits $265,120 11,000 183,000 6,280 6,100 $471,500 Credits $ 21,960 1,160 48,500 29,490 166,160 6,100 198,130 $471,500