The City of Evansville operated a summer camp program for at-risk youth. Businesses and nonprofit organizations sponsor
Question:
The City of Evansville operated a summer camp program for at-risk youth. Businesses and nonprofit organizations sponsor one or more youth by paying the registration fee for program participants. The following Schedule of Cash Receipts and Disbursements summarizes the activity in the program's bank account for the year.
1. At the beginning of 2017, the program had unrestricted cash of $18,000.
_____________________________ Cash Basis 12 months
Cash receipts:
Registration fees .................................. $125,000
Borrowing from bank ................................50,000
Total deposits .......................................175,000
Cash disbursements:
Wages ..................................................66,575
Payroll taxes ........................................... 9,000
Insurance (paid monthly) ............................ 6,000
Purchase of bus ...................................... 60,000
Interest on bank note ................................. 1,500
Total checks ........................................ 143,075
Excess of receipts over disbursements ......... $ 31,925
2. The loan from the bank is dated April 1 and is for a five-year period. Interest (6 percent annual rate) is paid on October 1 and April 1 of each year, beginning October 1, 2017.
3. The bus was purchased on April 1 with the proceeds provided by the bank loan and has an estimated useful life of five years (straight-line basis-use monthly depreciation).
4. All invoices and salaries related to 2017 had been paid by close of business on December 31, except for the employer's portion of December payroll taxes, totaling $800.
A. Prepare the journal entries, closing entries, and a Statement of Revenues, Expenses, and Changes in Fund Net Position assuming the City intends to treat the summer camp program as an enterprise fund.
B. Prepare the journal entries, closing entries, and a Statement of Revenues, Expenditures, and Changes in Fund Balance assuming the City intends to treat the summer camp program as a special revenue fund?
Step by Step Answer:
Essentials of Accounting for Governmental and Not for Profit Organizations
ISBN: 978-1259741012
13th edition
Authors: Paul A. Copley