On December 30, 2016, a county purchases a new snow plow for $100,000. On January 2, 2017, the snow plow is seriously damaged in an accident. The plow is uninsured. Soon after the accident, the county is able to sell the snow plow for $10,000.
(a) Record the purchase of the snow plow in the county's general fund.
(b) Record the sale of the snow plow.
(c) How would the sale of the snow plow affect the general fund's operating statement?
(d) How would the sale of the snow plow affect the governmental activities column of the government-wide statement of activities?
(e) Explain the rationale for the difference between the information conveyed in the fund operating statement vs. the government-wide statement of activities in relation to the snow plow.

Question

Quizplus · Accepted Answer

The Answer of On December 30, 2016, a county purchases a new snow plow for $100,000. On January 2, 2017, the snow plow is seriously damaged in an accident. The plow is uninsured. Soon after the accident, the county is able to sell the snow plow for $10,000.
(a) Record the purchase of the snow plow in the county's general fund.
(b) Record the sale of the snow plow.
(c) How would the sale of the snow plow affect the general fund's operating statement?
(d) How would the sale of the snow plow affect the governmental activities column of the government-wide statement of activities?
(e) Explain the rationale for the difference between the information conveyed in the fund operating statement vs. the government-wide statement of activities in relation to the snow plow.

On December 30, 2016, a County Purchases a New Snow