The General Fund of the City of Parkersburg made a permanent contribution of $100,000 to an internal service fund in 2009. Also, during the year, the internal service fund had revenues of $500,000, expenses of $450,000 and a transfer out of $30,000. Assuming this was the first year of operations for the internal service fund, the ending net assets balance, after closing entries, would be:

Question

Quizplus · Accepted Answer

The ending net assets balance is calculated by adding the initial contribution ($100,000) to the net income (revenues of $500,000 minus expenses of $450,000) and subtracting the transfer out ($30,000). This results in $100,000 + ($500,000 - $450,000) - $30,000 = $120,000.

The General Fund of the City of Parkersburg Made a Permanent