A city accounts for its capital acquisitions using encumbrances.When the city enters into a contract to acquire equipment,what journal entry should it make?
A) debit expenditures - capital outlay;credit vouchers payable
B) debit encumbrances;credit budgetary fund balance reserved for encumbrances
C) debit equipment;credit vouchers payable
D) debit encumbrances;credit appropriations - equipment
Correct Answer:
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