Complete the following problems and exercises, showing all work and submit in the classroom.

1. Identification of Fiduciary Funds. Following is a
list of fund names and descriptions from comprehensive annual financial
reports (CAFRs). Indicate which of the following are fiduciary funds.
If not a fiduciary fund, identify which type of fund should be used to
account for the activities and explain why that fund is most
appropriate.

1. Tri-Centennial Fund. Accounts for money raised or contributed by
   several local area governments and other organizations. The purpose is
   to ensure availability of resources to celebrate the United States
   Tri-Centennial in 2076.
2. Perpetual Care Fund. Accounts for endowed gifts and investment earnings dedicated to perpetual care of the city’s cemeteries.
3. Poudre River Public Library District Fund. Accounts for cash and
   investments held by the city on behalf of Poudre River Public Library
   District.
4. School Impact Fee Fund. The city collects school impact fees as part
   of the cost of building permits issued. Money must be remitted
   periodically to the local school district, a legally separate government
   that is not a component unit of the city.
5. Cultural Services and Facilities Fund. Accounts for revenues
   received from the Lincoln Center performing arts facility, the city
   museum, and General Fund subsidies used to promote cultural activities
   for city residents.
6. Payroll Fund. The city has established a fund in which all payroll deductions are reported.
7. Telephone Commissions Fund. The city collects commissions on pay
   telephones used by jail inmates. The funds are used to provide inmates
   such benefits as library resources and fitness equipment.
8. Block Grant Fund. The state receives federal funds for the homeless
   which it passes through to local not-for-profit organizations. The only
   responsibility the state has is to contribute an additional amount of
   funds (match) to the federal grant.
9. Health Benefits Fund. The county has agreed to pay a portion of the
   health insurance premiums for employees when they retire. Contributions
   for the benefit are paid into this fund.
10. Unclaimed Property Fund. The state has established a fund to account
    for abandoned and unclaimed property. The property is held in the fund
    for 10 years. If a legal claimant to the property is not found within
    the 10-year time period, the property reverts to the state.

2. Investment Trust Fund. The Albertville City
Council decided to pool the investments of its General Fund with
Albertville Schools and Richwood Township in an investment pool to be
managed by the city. Each of the pool participants had reported its
investments at fair value as of the end of 2016. At the date of
creation of the pool, February 15, 2017, the fair value of the
investments of each pool participant was as follows:

		Investments
	12/31/16	2/15/17
City of Albertville General Fund	$ 890,000	$900,000
Albertville Schools	$4,200,000	$4,230,000
Richwood Township	$3,890,000	$3,870,000
Total	$8,980,000	$9,000,000

Using this information:

1. Prepare the journal entries that should be made by the City of
   Albertville, Albertville Schools, and Richwood Township on February 15
   to record their participation in the investment pool. (Entries for the
   investment pool trust fund will be made later.)
2. Prepare the journal entries to be made in the accounts of the
   investment pool trust fund to record the following transactions of the
   first year of operations:
   1. Record the investments transferred to the pool; assume that the
      investments of the city’s General Fund were in U.S. Treasury notes and
      the investments of both the schools and the township were in
      certificates of deposit (CDs).
   2. On June 15, the Richwood Township decided to withdraw $3,010,000 for
      a capital projects payment. At the date of the withdrawal, the fair
      value of the Treasury notes has increased by $30,000. Assume that the
      trust fund is able to redeem the CDs necessary to complete the
      withdrawal without a penalty but does not receive interest on the funds.
   3. On September 15, interest on Treasury notes in the amount of $50,000 was collected.
   4. Interest on CDs accrued at year-end amounted to $28,000.
   5. At the end of the year, undistributed earnings were allocated to the
      investment pool participants. Assume that there were no additional
      changes in the fair value of investments after the Richwood Township
      withdrawal. Round the amount of the distribution to each fund or
      participant to the nearest dollar.
3. Record the June 15 increase in each of the participant’s funds.
4. Record the change in each participant’s Equity in Pooled Investment
   account due to the September 15 treasury interest and December 31 CD
   interest accrual.
5. Explain how the investment trust fund would report the General
   Fund’s interest in the investment pool and the Albertville School’s
   interest in the investment pool.

3. Comprehensive Set of Transactions. The City of Lynnwood was recently incorporated and had the following transactions for the fiscal year ended December 31, 2017.

• The city council adopted a General Fund budget for the fiscal year. Revenues were estimated at $3,000,000 and appropriations were $2,990,000.
• Property taxes in the amount of $2,000,000 were levied. It is estimated that $8,000 of the taxes levied will be uncollectible.
• A General Fund transfer of $30,000 in cash and
  $300,000 in equipment (with accumulated depreciation of $65,000) was
  made to establish a central duplicating internal service fund.
• A citizen of Lynnwood donated marketable securities with a fair
  value of $900,000. The donated resources are to be maintained in
  perpetuity with the city using the revenue generated by the donation to
  finance an after school program for children, which is sponsored by the
  parks and recreation function. Revenue earned and received as of
  December 31, 2017, was $45,000.
• The city’s utility fund billed the city’s General Fund $125,000 for
  water and sewage services. As of December 31, the General Fund had paid
  $124,000 of the amount billed.
• The central duplicating fund purchased $4,500 in supplies.
• Cash collections recorded by the general government function during the year were as follows:

Property taxes	$1,925,000
Licenses and permits	35,000
User charges	28,000

• During the year the internal service fund billed the city’s general
  government function $15,700 for duplicating services and it billed the
  city’s utility fund $8,100 for services.
• The city council decided to build a city hall at an estimated cost
  of $5,000,000. To finance the construction, 6 percent bonds were sold at
  the face value of $5,000,000. A contract for $4,500,000 has been signed
  for the project; how- ever no expenditures have been incurred as of
  December 31, 2017.
• The general government function issued a purchase order for $32,000
  for computer equipment. When the equipment was received, a voucher for
  $31,900 was approved for payment and payment was made.

Using this information, prepare all journal entries to properly
record each transaction for the fiscal year ended December 31, 2017. Use
the following funds and government-wide activities, as necessary:

General Fund	GF
Capital projects fund	CPF
Internal service fund	ISF
Permanent fund	PF
After School Fund (a special revenue fund)	SRF
Enterprise fund	EF
Governmental activities	GA

Each journal entry should be numbered to correspond with each transaction. Do not prepare closing entries.

Your answer sheet should be organized as follows:

Transaction Number	Fund or Activity	Account Title	Amounts
			Debits	Credits

4. Net Position Classifications. Section A provides a
list of transactions or events that occurred during the year, followed
by Section B, a list of the possible effects each transaction or event
has on adjusting net position accounts at year-end, assuming that all
temporary accounts have already been closed to the account Net Position –
Unrestricted.

Section A

1. Depreciation was recorded for the year.
2. A fully depreciated computer was sold for $50.
3. Bonds issued to construct the new library were retired.
4. Construction expenditures were incurred for the new fire substation.
5. Grant funds that can only be used for a summer kids’ camp remain unexpended at year-end.
6. An operating lease was entered into during the year.
7. A $3 million endowment was received during the year.
8. Several new fire trucks were purchased and 70 percent financed with long-term notes.
9. The capital projects fund transferred its residual fund balance to the debt service fund during the year.
10. A grant received in the prior year for afterschool recreational activities was expanded.

Section B

1. Restricted Net Position is increased and Unrestriced Net Position is decreased.
2. Restricted Net Position is decreased and Unrestriced Net Position is increased.
3. Net Investment in Capital Assets is increased and Unrestriced Net Position is decreased.
4. Net Investment in Capital Assets is decreased and Unrestricted Net Position is increased.
5. None of the above.

Required

Indentify how the new position categories would need to be adjusted
for each of the transactions. For the statement in Section A, select the
appropriate answer from Section B.

5. Change in Net Position of Governmental Activities.
You have been provided with the following information concerning
operating activity for Annette County. For the year ended June 30, 2017,
the net change in total governmental fund balances was $(289,200), and
the change in net position of governmental activities was $194,300.
During the year, Annette issued $2,000,000 in general obligation bonds
at a premium of 101. The bonds are to be used for a construction
project. The county acquired $2,750,000 in capital assets and sold
capital assets with a book value of $563,000 for $570,900. At the
beginning of the period accrued liabilities were $470,000 and at the end
of the period they totaled $494,000. Depreciation on capital assets
totaled $595,000. Revenue accrued for the period but not available for
use totaled $364,000.

Using the information provided, prepare a reconciliation of the
change in governmental fund balance to the change in net position of
governmental activities.