Prepare Journal Entries in the Motor Pool Department of Hill

question 45

Essay

Prepare journal entries in the motor pool department of Hill County to record each of the following transactions.
1.The General Fund contributed $50,000 cash to the motor pool department.The motor pool department purchased four vehicles on July 1,2014 by paying $50,000 down and borrowing $70,000 on a 5%,3-year note.
2.Billed General Fund departments $430,000 for services provided to those departments.Billings to the Enterprise Fund totaled $210,000.All billings were collected by year-end (June 30,2015)except for $80,000 charged to the General Fund.
3.Accrued year-end adjustments at June 30,2015 for interest expense and depreciation.The useful life of the equipment is 5 years with no salvage value.

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Definitions:

Other Expenses

Costs that do not fit into the standard categories of operating expenses, often incidental or infrequent.

Spending Variance

The difference between the actual amount spent and the budgeted or planned amount for a specific period.

Containers Refurbished

Describes the process of cleaning, repairing, and possibly upgrading containers so they can be reused rather than disposed of.

Fixed and Variable Cost

Fixed costs remain constant regardless of the level of production or business activity, whereas variable costs change in proportion to the business's production volume.