Prepare Journal Entries to Record the Following Grant-Related Transactions of an Enterprise

question 32

Essay

Prepare journal entries to record the following grant-related transactions of an Enterprise Fund.
1.Received an operating grant in cash from the state,$2,500,000.
2.Incurred and paid qualifying operating expenses on the state grant program,$1,600,000.
3.Received a federal grant to finance construction of a plant,$4,500,000 (cash received in advance).
4.Incurred and paid construction costs on the plant,$3,000,000.The plant is not completed.

---

Definitions:

Time-based Activity-based Costing

An approach that combines the principles of activity-based costing with a focus on how much time activities consume, improving the accuracy of cost allocation.

Stage One Allocations

Stage One Allocations is a phase in cost accounting where overhead costs are allocated to different departments or cost centers before being assigned to specific products or services.

Extensive Interviews

In-depth conversations typically used for gathering qualitative information or data.

Practical Capacity Percentage

The ratio of actual production volume to the maximum possible volume that could be achieved under optimal conditions.