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Vinil7 [7]
3 years ago
7

On July 1, 2018, Fred City ordered $1,500 of office supplies.They were to be paid for out of the general fund. Entry under:

Business
1 answer:
mel-nik [20]3 years ago
6 0

Answer:

A) Dr. Encumbrances – Office supplies              No entry

Cr. Encumbrances outstanding

Explanation:

The journal entry is given below;

For Governmental fund financial statements

Encumbrances-Office Supplies $1,500  

      To Encumbrances Outstanding $1,500

(Being Office Supplies ordered  is recorded)

For Government-wide financial statements

No journal entry is required as under the accrual accounting, no entry should be recorded until the transaction does not arise

Therefore the option a is correct

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