Question

4–5. Prepare journal entries in the General Fund of the Brownville School District. a. The District had outstanding encumbrances of $11,200 for band instruments from the previous year. It is the District's policy to re-establish those encumbrances in the subsequent year. b. The District ordered textbooks at an estimated cost of $57,000. C. The band instruments arrived at an invoice price of $10,900 plus $290 shipping. d. Textbooks originally estimated to cost $49,000 were received with an invoice price of $48,500. The remaining portion of the order is back-ordered. e. A contract was signed with a CPA to provide the annual audit in the amount of $5,200.

Answer 1

Transaction	General journal	Debit	Credit
A)	Encumbrances control prior year	$ 11,200
	Budgetary Fund balances- Reserve for Encumbrances		$ 11,200
	( To record Re-Establishing Encumbrance )
B)	Encumbrances control	$ 57,000
	Budgetary Fund balances- Reserve for Encumbrances		$ 57,000
	(To record place an order )
C)1)	Encumbrances control	$ 10,900
	Budgetary Fund balances- Reserve for Encumbrances		$ 10,900
	(To record place an order )
C)2)	Expenditures ($10,900 +$ 290 )	$ 11,190
	Accounts payable		$ 11,190
	(To record receive the goods )
C)3)	Budgetary Fund balances- Reserve for Encumbrances	$ 10,900
	Encumbrances control		$ 10,900
	(To record receive the goods )
C)4)	Accounts payable ($10,900 +$ 290 )	$ 11,190
	Cash		$ 11,190
	( To record payment of goods )
D)1)	Budgetary Fund balances- Reserve for Encumbrances	$ 49,000
	Encumbrances control		$ 49,000
	(To record Reverse the encumbered amount )
D)2)	Expenditures control	$ 48,500
	Accounts payable		$ 48,500
	(To record Expenditure Recording )
D)3)	Accounts payable	$ 48,500
	Cash		$ 48,500
	( To record payment of goods )
E)	Encumbrances control	$ 5,200
	Budgetary Fund balances- Reserve for Encumbrances		$ 5,200
	(To record place the order )