SEU GNP Accounting Worksheet

Q.1 Art on Wheels is a newly formed not-for-profit corporation. Its purpose is to promulgate public appreciation of 19th century Saudi artists. It plans to solicit works of art from donors and to display them both in a museum and in a specially constructed bus that will travel throughout the country. It establishes a written policy to collect works of art, exhibit them, and protect them from harm. Its policy also calls for selling donated works of art that do not meet its stated objective of enhancing appreciation of 19th century Saudi artists. Proceeds from those sales will be used either to purchase works that meet its objectives or, when necessary, to defray the expenses of displaying the works.

Required: Discuss the accounting requirements (including available options)

(a) recognizing revenues and assets resulting from donations of works of art, and

(b) depreciation of art works. (Marks 0.5)

Q2. Malaz Township decides to construct a new city hall. Based on the following data, prepare a statement of revenues, expenditures, and changes in fund balance for Malaz Township’s Capital Projects Fund. All transactions occur within the calendar year 2020.

a.The Fund starts and ends the year with a zero fund balance.

b.The Fund’s financing sources for the city hall project were long-term bond proceeds – $6 million; operating transfer from the General Fund – $2 million; state grant – $1.5 million; interest from the temporary investment of cash – $90,000.

c.Total outlays for constructing the new city hall were construction costs – $8,250,000; design and construction supervision fees – $600,000.

d.City laws require that, whenever bonds are used, any remaining difference between total financing sources and construction costs must be transferred to the Debt Service Fund.Therefore, $740,000 was transferred to the Debt Service Fund.

(Mark 1.5)

Q.3 Whitt Valley Hospital is a not-for-profit initial care facility.Prepare a Statement of Operations for Whitt Hospital using the following information for its calendar year ending December 31, 2016:

  • Third-parties and direct-pay patients were billed $6,500,000 at the hospital’s established billing rates
  • The hospital determined that certain of its patients qualified for charity care and that it would not seek to collect $950,000 at established billing rates from direct-pay patients
  • The hospital estimated contractual adjustments for the year, including year-end adjustments of $1,600,000
  • The hospital estimated uncollectible amounts from direct-pay patients to be $250,000
  • The hospital received capitation premiums of $2,500,000.It estimated that the cost of providing this care was $1,800,000
  • The hospital reported salaries and wages of $4,500,000 for the year
  • The fair value of investments held by the hospital increased by $25,000
  • The hospital reported interest and dividend income of $100,000
  • The hospital used $375,000 of temporarily restricted resources to purchase capital assets, consistent with the restrictions imposed by the donor
  • The hospital reported depreciation expense of $475,000
  • The hospital used supplies inventories of 365,000
  • The hospital incurred other operating expenses of $275,000

Chapter-13 – (Marks 1.5)

Q.4 KK Building Construction receives an annual appropriation to perform construction activities. KKBC does not use commitment accounting; instead, it obligates funds upon the award of contracts Prepare budgetary and proprietary journal entries to record the following transactions.

a.KKBC received an appropriation of $10,00,000.

b.The Office of Management and Budget apportioned $400,000 of the appropriation to the Department of Domestic Construction, which oversees the KKBC

c.The Department allotted the entire $400,000 apportionment to the KKBC.

d.KKBC awarded a building construction contract for $250,000.

Ch-11 (Marks 1)

Q5. What are the financial statement and financial condition analysis indicators for liquidity ratios? (Marks 0.5) Chapter 14

Place this order or similar order and get an amazing discount. USE Discount code “GET20” for 20% discount

Posted in Uncategorized