Biology Forums - Study Force

A government with a beginning inventory of supplies of $100 in its General Fund and had the following transactions during the year (all amounts are in thousands).

Transactions:

1.   Ordered supplies with an estimated cost of $3,150.
2.   Received supplies with an actual invoice cost of $2,920. No payment was made upon receipt; $2,950 was the encumbered amount.
3.   Paid $2,300 on account for supplies received in #2.
4.   During the year, the inventory warehouse issued $2,900 in supplies to general government departments.
5.   The ending physical inventory of General Fund supplies found $150 on hand at year end.

Requirements:

A.   Consumption method of accounting for inventory
1.   Prepare the general journal entries required to account for the previous information.
2.   Indicate the effects of the general journal entries on the Balance Sheet equation.
3.   Indicate amounts reported on Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balance with respect to the Inventory of Supplies.
B.   Purchases method of accounting for inventory
1.   Prepare the general journal entries required to account for the previous information.
2.   Indicate the effects of the general journal entries on the Balance Sheet equation.
3.   Indicate amounts reported on Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balance with respect to the Inventory of Supplies.

 

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