Static City Started a Department to Provide Copy,printing and Mailing

question 42

Essay

Static City started a department to provide copy,printing and mailing services for all departments and agencies of the city.
During the fiscal year from July 1,2013 through June 30,2014,the copy services department had the following transactions:
1.Paper and toner inventory was purchased for $58,000,on account.
2.The paper and toner inventory physical count showed only $8,000 on hand at June 30,2014.
3.The department billed other departments for services rendered to them amounting to: General Fund,$43,000; Enterprise Fund,$24,000; Debt Service Fund,$21,000; and Trust Fund,$16,000.All receivables were collected with the exception of $6,000 from the Trust Fund which is expected to be collected in July,2014.
4.The department incurred and paid the following expenses: salaries and wages,$23,000; Electric,$8,000; Other operating expenses,$6,000.Also,$63,000 of the Accounts Payable were paid during the year.
5.Depreciation Expense on Equipment amounted to $6,000 for the year ending June 30,2014.
6.The department prepared the closing entries on June 30,2014.
Required:
For the fiscal year ended June 30,2014,prepare the journal entries to record the transactions for the Internal Service Fund.

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Definitions:

Net Income

The total profit of a company after all expenses, including taxes and operational costs, have been deducted from total revenue.

Closing the Revenue

Closing the Revenue involves transferring the revenue earned during an accounting period to the capital account to prepare the company's books for the next period.

Original Investments

The capital that the owners or shareholders initially put into the business to fund operations.

Net Loss

The deficit that occurs when a company's total expenses exceed its total revenues, indicating a negative profit for a specific period.