Question :
On 1st January, 2012, the first day of its fiscal year, the City of Carter received announcement that a federal grant in the amount of $650,000 was approved. The grant was restricted for the payment of wages to teenagers for summer employment.
The terms of the grant permitted reimbursement only after qualified expenditures have been made; the grant would be used over a two-year period in equal amounts of $325,000 each. The subsequent data pertain to operations of the Summer Employment Grant Fund, a special revenue fund of the City of Carter, in the year ended 31st December, 2012.
Show entries in general journal form to record the subsequent events and transactions in the accounts of the Summer Employment Grant Fund:
1. The budget was recorded. It is given for Estimated Revenues for the year in the amount of $325,000, and for Appropriations in the amount of $325,000.
2. A temporary loan of $325,000 was gets from the General Fund.
3. In this year, teenagers earned and were paid $312,000 under terms of the Summer Employment program. An additional $5,000 is accrued as payable on 31st December. Recognize the revenue and receivable (include the $5,000 of wages payable).
4. Every month a properly documented request for reimbursement was sent to the federal government; checks for $298,000 were received.
5. Required closing entries were made.