Problem #3: Expenditures and Encumbrances (30 points)

Part 1: Basic Entries

In its fiscal 2022 budget, City of Gasby approved appropriations of $1,200,000 for capital outlays for computers in the school department.

At May 31, 2022, the City had incurred actual expenditures of $854,000 and had $84,000 of encumbrances outstanding.

a. Calculate the amount available to be expended by the school department at May 31, 2022 (3 points)

Available for Expenditure at May 31, 2022

Supporting Calculations Required:

b. On June 7, 2022, computers were received by the school department at an actual cost of $76,000 that were previously encumbered for $84,000. (1 point for the fund plus 2 points per entry = 5 points)

RECORDED IN:
DATE	ACCOUNT NAMES		DEBIT	CREDIT

RECORDED IN:
DATE	ACCOUNT NAMES		DEBIT	CREDIT

c. On June 24, 2022, a purchase order for computers costing $125,000 was issued by the school department. (1 point for the fund plus 2 points for the entry = 3 points)

RECORDED IN:
DATE	ACCOUNT NAMES		DEBIT	CREDIT

d. On June 30, 2022, the City of Gasby made the appropriate entries to close the outstanding encumbrance for computers for the school department and recognize committed fund balance. (1 point for the fund plus 2 points for the entry = 5 points)

RECORDED IN:
DATE	ACCOUNT NAMES		DEBIT	CREDIT

RECORDED IN:
DATE	ACCOUNT NAMES		DEBIT	CREDIT

e. On July 31, 2022, the City of Gasby received the computers ordered on June 24, 2022 with an invoice for its actual cost of $125,000. (1 point for the fund plus 2 points for the entry = 3 points)

RECORDED IN:
DATE	ACCOUNT NAMES		DEBIT	CREDIT

f. On June 30, 2023, Gasby closed the Expenditures-Prior Year account. (1 point for the fund plus 2 points for the entry = 3 points)

RECORDED IN:
DATE	ACCOUNT NAMES		DEBIT	CREDIT