How should governments report their capital projects and debt service activities in their government-wide statements?

Ch 6. Questions for Review and Discussion

6. How should governments report their capital projects and debt service activities in their government-wide statements?

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Draw the activity-on-node (AON) project network associated with the following activities for Dave Carhart’s consulting company project

Problem 3.3 Draw the activity-on-node (AON) project network associated with the following activities for Dave Carhart’s consulting company project. How long should it take Dave and his team to complete this project? What are the critical path activities?

Activity Immediate Predecessor Days
A - 3
B A 4
C A 6
D B 6
E B 4
F C 4
G D 6
H E,F 8


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The following is a table of activities associated with a project at Bill Figg Enterprises, their durations and what activities each must precede

Problem 3.15 The following is a table of activities associated with a project at Bill Figg Enterprises, their durations and what activities each must precede:

ACTIVITY DURATION (WEEKS) PRECEDES
A (START) 1 B,C
B 1 E
C 4 F
E 2 F
F(END) 2 -

a) Draw an AON diagram of the project, including activity durations.
c) What is the project duration (in weeks)?
d) What is the slack (in weeks) associated with any and all noncritical paths through the project?


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What are noncash investing and financing activities?

3. What are noncash investing and financing activities? Provide an example. How are such transactions shown on the statement of cash flows?


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The following are various activities an auditor does during audit planning

Auditing P 8-28
The following are various activities an auditor does during audit planning:
1. Send an engagement letter to the client.
2. Tour the client's plant and offices.
3. Compare key ratios for the company to industry competitors.
4. Review managements risk management controls and procedures.
5. Identify potential related parties that may require disclosure.
6. Identify whether any specialists are required for the engagement.
7. Review accounting principles unique to the clients industry.
8. Determine the likely users of the financial statements.

Required:
For each procedure, indicate which of the first four parts of audit planning the procedure primarily relates to:
1. accept client and perform initial audit planning;
2. understand the clients business and industry;
3. assess client business risk;
4. perform preliminary analytical procedures.


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Listed are typical financial activities of a local governmental unit

Exercise 17-2 (General Fund Journal Entries) Listed are typical financial activities of a local governmental unit.

1. The legislative unit approved the budget for the general operating fund. Estimated revenues are $4,000,000, and appropriations for expenditures are $3,800,000.
2. Statements of property tax assessments totaling $3,000,000 were mailed to property owners. It is estimated that 4% of the assessed taxes will be uncollectible.
3. Notification was received from the state that this unit’s share of sales tax revenues from the fourth quarter of the previous year will be $500,000.
4. The manager signed a contract to purchase equipment costing $250,000.
5. The equipment ordered above was received and paid for.
6. Employees were paid their biweekly wages of $36,000.
7. Property taxes in the amount of $2,050,000 were collected.

Required:
Prepare the necessary journal entries to record the transactions listed above in the records of the General Fund


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(Computation of Operating Activities—Direct Method) Presented below are two independent situations

E23-7 (Computation of Operating Activities—Direct Method) Presented below are two independent situations.

Situation A:
Chenowith Co. reports revenues of $200,000 and operating expenses of $110,000 in its first year of operations, 2010. Accounts receivable and accounts payable at year-end were $71,000 and $39,000, respectively. Assume that the accounts payable related to operating expenses. Ignore income taxes.

Instructions
Using the direct method, compute net cash provided (used) by operating activities.

Situation B:
The income statement for Edgebrook Company shows cost of goods sold $310,000 and operating expenses (exclusive of depreciation) $230,000. The comparative balance sheet for the year shows that inventory increased $21,000, prepaid expenses decreased $8,000, accounts payable (related to merchandise) decreased $17,000, and accrued expenses payable increased $11,000.

Instructions
Compute (a) cash payments to suppliers and (b) cash payments for operating expenses.

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