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    Closing Entries and Balance Sheet for Lone Wolf

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    The preclosing trial balance at December 31, 20X1, for Lone Wolf's general fund follows.

    Debit Credit
    Cash $ 90,000
    Property Taxes Receivable---Delinquent 100,000
    Allowance for Uncollectibles---Delinquent $ 72,000
    Due from Other Funds 14,600
    Vouchers Payable 65,000
    Due to Other Funds 8,400
    Fund Balance---Unreserved 119,000
    Property Tax Revenue 1,130,000
    Miscellaneous Revenue 40,000
    Expenditures 1,140,000
    Other Financing Uses---Transfer Out 25,000
    Estimated Revenues Control 1,200,000
    Appropriations Control 1,145,000
    Estimated Other Financing Uses---Transfer Out 25,000
    Encumbrances 32,000
    Budgetary Fund Balance---Reserved for Encumbrances 32,000
    Budgetary Fund Balance---Unreserved 30,000
    Total $ 2,601,600 $ 2,601,600

    Lone Wolf uses the purchase method of accounting for inventories and the lapsing method of accounting for encumbrances.

    a. Prepare the closing entries for the general fund.
    b. Prepare a general fund-only balance sheet at December 31, 20X1.

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    Solution Summary

    This tutorial provides guidelines for creating closing entries and balance sheets.