The City of Sill Established an Internal Service Fund to Provide

question 16

Essay

The City of Sill established an Internal Service Fund to provide cleaning services to all city offices and departments.The following transactions took place with respect to this event.
1.The General Fund contributed cash of $49,000 to the Internal Service Fund.The General Fund provided a $10,000 loan to the Internal Service Fund.
2.On January 1,2011,the Internal Service Fund acquired a floor waxing machine for cash of $5,000.It has a 5 year life with no salvage value,and the city uses straight-line depreciation on their assets.
3.The cleaning services department billed other government agencies and departments $226,000 and collected $187,000.
4.The cleaning services department incurred and paid the following expenses: cleaning personnel wages,$65,000;payroll taxes,$10,000;cleaning supplies,$13,000;and office rental and utilities,$77,000.The cleaning services department also repaid the general fund for the loan.
5.The cleaning services department prepared the journal entry to depreciate their assets for the year ending December 31,2011.
Required:
Prepare the necessary journal entries for each of the above transactions for the Internal Service Fund.

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Definitions:

Pollyanna Effect

The inclination among individuals to recall positive events or information with greater precision than negative ones.

Different Background

A different background refers to the diverse experiences, cultures, or education levels individuals come from, contributing to a rich variety of perspectives.

Perceptual Error

A cognitive mistake that occurs when one's interpretation of sensory information does not accurately reflect reality.

Golem Effect

The phenomenon where lower expectations placed upon individuals either by supervisors or the individuals themselves lead to poorer performance.