Purchase Solution

City of Sharpesburg: Library Book Permanent Fund JEs

Not what you're looking for?

Ask Custom Question

Complete in excel in proper format with no lines in the journal entry.

5-12. The City of Sharpesburg received a gift of $950,000 from a local resident on June 1, 2012, and signed an agreement that the funds would be invested permanently and that the income would be used to purchase books for the city library.
The following transactions took place during the year ended December 31, 2012:
1. The gift was recorded on June 1.
2. On June 1, ABC Company bonds were purchased as investments in the amount of $950,000 (par value). The bonds carry an annual interest rate of 6 percent, payable semiannually on December 1 and June 1.
3. On December 1, the semiannual interest payment was received.
4. From December 1 through December 31, $27,700 in book purchases were made; full payment was made in cash.
5. On December 31, an accrual was made for interest.
6. Also, on December 31, a reading of the financial press indicated that the ABC bonds had a fair value of $966,000, exclusive of accrued interest.
7. The books were closed.

Required:
a. Record the transactions on the books of the Library Book Permanent Fund.
b. Prepare a separate Statement of Revenues, Expenditures, and Changes in Fund Balances for the Library Book Permanent Fund for the Year Ended December 31, 2012.

Purchase this Solution
Solution Summary

Your tutorial shows the entries needed and the statement as a template for similar problems and for self review and study.

Solution provided by:
Carol Sargent, PhD
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
Recent Feedback
  • "hey just wanted to know if you used 0% for the risk free rate and if you didn't if you could adjust it please and thank you "
  • "Thank, this is more clear to me now."
  • "Awesome job! "
  • "ty"
  • "Great Analysis, thank you so much"
Purchase this Solution
Free BrainMass Quizzes
Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

Accounting: Statement of Cash flows

This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.

Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking

Balance Sheet

The Fundamental Classified Balance Sheet. What to know to make it easy.

Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.

View More Free Quizzes
Related BrainMass Solutions

  • Fund accounting: Fiduciary funds vs. permanent funds

    Christopher City received a contribution of $520,000 to provide scholarships to the children of deceased city employees.

  • Fund Transactions

    We can therefore say that the bequest be accounted for under a PERMANENT fund. d.

  • Statement of Revenues, Expenses, and Changes in Fund Net Assets

    114920 Statement of Revenues, Expenses, and Changes in Fund Net Assets The City of San Jominz received a $500,000 federal grant to acquire several buses to be used in its public transit system. The City paid $400,000 to acquire several buses.

  • Bonds & budgets: Interest payable

    Sue City has outstanding $5 million in general term bonds used to finance the construction of the new City Library. Sue City has a June 30 fiscal year-end. Interest at 6% is payable each January 1 and July 1.

  • strategic management questions

    Debt Service Fund f. Super City pays $4 million to a contractor for work on one of these bridges. Capital Projects Fund g. Super City pays $80,000 in wages and salaries to police officers. Permanent Fund h.

  • Governmental and Not-for-profit Accounting

    However, city officials have the authority to redirect the fees to any public use. Should this fee be accounted for in a general fund or a special revenue fund? Why? Is the collection of the fee an exchange or nonexchange transaction?

  • Eastern Contingent Liabilities: Record or not? JEs footnote

    JEs and footnote. Contingent Liabilities: Eastern Chemical Co. The following contingent matters involve your client: 1.

  • Government Accounting -- Journal Entries

    The Wickliffe City Council approves a budget of $9,027,000 to restore the city library. The project is to be funded by the issuance of $6 million of general obligation bonds, a $2.5 million state grant, and $527,000 from general fund property taxes.

  • 13) Governmental units use which fund type to account for se

    Permanent fund B. Enterprise fund C. General fund D. Internal service fund 14) Proprietary funds utilize what basis of accounting? A. Cash B. Accrual C. Modified accrual D.

View More Related Solutions