The City of Granville operates an internal service fund to provide garage space and repairs for city-owned and operated vehicles. The Garage Fund’s pre closing trial balance for the current fiscal year is as follows.
Case Study 2-Internal Service Fund
The City of Granville operates an internal service fund to provide garage space and repairs for city-owned and operated vehicles. The Garage Fund’s preclosing trial balance for the current fiscal year is as follows.
Cash $ 140,000
Due from Other Funds 18,000
Inventory of Supplies 120,000
Allowance for Depreciation-Building $ 40,000
Machinery and Equipment 75,000
Allowance for Depreciation-Machinery
And Equipment 15,000
Vouchers Payable 36,000
Net Position-Net Investment in Capital
Net Position-Unrestricted 265,000
$ 703,000 $ 703,000
The following information has not been reflected in the preclosing figures above, applies to the current year.
1. Supplies were purchased on account for $98,000; the perpetual inventory method is used.
2. The cost of supplies used during the year was $130,000. A physical count taken as of that date showed materials and supplies on hand totaled $88,000 at cost.
3. Salaries and wages paid to employees totaled $245,000; including related costs.
4. Billings totaled $36,000 were received from the city enterprise fund for utility charges. The Central Garage Fund paid $31,000 of the amount owed. (At the governmental level, record the payable amount as Internal Balances).
5. Depreciation on the building was $12,000; depreciation on the machinery and equipment was $10,000.
6. Billings to other departments for services provided to them were as follows.
General Fund $310,000
Special Revenue Fund 137,000
7. Unpaid interfund receivable balances were as follows.
General Fund $ 14,000 $ 11,000
Special Revenue Fund 4,000 6,500
8. Vouchers Payable at year-end were $21,000.
9. Closing entries were prepared for the Central Garage Fund. (Do not prepare government-wide closing entries.)
A. Prepare journal entries to record all of the transactions for this period in the Central Garage Fund accounts and in the governmental activities accounts. Assume all expenses at the government-wide level are charged to the General Government function.
B. Prepare a statement of revenues, expenses, and changes in fund net position for the Central Garage Fund for the period.
C. Prepare a statement of net position for the Central Garage Fund as of year-end.