Foryears beginning January 1,2018, the city of Arbor Hills financesits park and recreation activities with a special property taxlevy. Accordingly, it will account for resources related to parksand recreation in a special revenue fund. During 2018, it engagedin the following transactions:
1) the fund received $6million from the city special park andrecreation property tax levy
2) the employee earned $0.17 million in sick leave but werepaid for only $0.14 million. The leave accumulates but does notvest.
3) During 2018, the city ordered $0.80million in parks andrecreation supplies. Of this amount,it received $0.70million, used$0.55million, and paid for $0.5million. The city uses the purchasesmathod to account for supplies inventory.
4) In January 2018, the city purchased $1million in parks andrecreation equipment. It paid. $0.20million in cash and gave aninstallment note for the balance. The first payment on the note($0.30 million plus interest of $0.05million)is due on January12,2019
Required:
A) Prepare a statement of revenue,expenditure and change infund balance and. Balance sheet for the park and recreation fund asa December 31,2018
B) indicate any assets,liability that would be reported in thecity’s schedule of capital assets, or long term obligation as aconsequence of the transactions engaged in by the park andrecreation fund
