The City of Deaver decided to create the Central Printing Fund, an internal service fund, designed to

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Question:

The City of Deaver decided to create the Central Printing Fund, an internal service fund, designed to centralize all printing requirements for the city's departments rather than use outside printing shops to meet their printing needs. The fund was created at the beginning of the fiscal year and had the attached transactions during the year.

REQUIRED:

(I) Prepare the general journal entries, in proper form, to record the transactions for the internal service fund for the current fiscal year. Omit explanations. Use the letter of the transaction as the date.

(2) Prepare a pre-closing trial balance, in proper form, for the fund at the end of the current fiscal year.

CITY OF DEAVER

TRANSACTIONS FOR CENTRAL PRINTING FUND

FOR CURRENT FISCAL YEAR

(a) The fund was created by an equity transfer from the General Fund in the amount of 550,000.

(b) Purchased equipment in the amount of $50,000 by issuing a note payable with a five year depreciate the equipment using the straight line method over 7 years with. an $8,000 salvage value. The note requires payment of equal amounts of principal at the end of each year for five years along with interest of 6% per year.

(c) Printing supplies were purchased on account in the amount of $40,000. The fund inventories these supplies until used.

(d) The fund took out a loan on a short term note payable in the amount of S50,000. The note is for one year at 5% interest per year.

(e) The General fund ordered 30,000 brochures for the Publicity Bureau. The Central Printing Fund billed the fund at $ 1.20 per brochure. The cost of the supplies used for this order was $25,000.

(f) Purchased $ 20,000 of supplies on account.

(g) Paid $35,000 of salaries to employees of the fund. Of this amount. $7,500 was withheld for taxes, which is payable to the City of beaver Tax Fund. The remainder was paid to the employees.

(h) Paid $35,000 on accounts payable.

(i) Paid the taxes to the City of Deaver Tax Fund.

(j) Paid the bill for the electric power and light in the amount of $1,850.

(k) The Electric Enterprise Fund ordered printing with a billing amount of $500. A special revenue fund also ordered printing with a billing amount of $6,200. The cost of supplies used for these two jobs was. $5,100.

(I) Received payment from the General Fund for its order in (d) above.

(m) A physical count of the inventory showed $29,000 of supplies on hand at the end of the year

(n) Recorded a full year's depreciation on the equipment.

(o) Recorded the principal payment on the long term note payable along with the interest payment for the year. Accrued interest for nine months on the short term note payable.