Assume that the one component unit had program revenues of $47,600 and expenses of $64,000 and spent $10,900 for land during Year 4. However, it should have been handled as a blended component unit, not as a discretely presented component unit. According to the information provided above, the overall increase in net position reported was $154,000. What was the correct overall change in the net position in the government-wide financial statements?

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Business

Gunnar Hanna

19 March, 12:36

Assume that the one component unit had program revenues of $47,600 and expenses of $64,000 and spent $10,900 for land during Year 4. However, it should have been handled as a blended component unit, not as a discretely presented component unit. According to the information provided above, the overall increase in net position reported was $154,000. What was the correct overall change in the net position in the government-wide financial statements?

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Paisley · Answer 1

If the overall increase in net assets remains the same at $154,000 then the program revenues and expenses were not included in the final figures for the government-wide financial statements. These two items were presented individually but should have blended with the total amount.

If these two figures were combined with the overall increase in net assets, the new figure would surmount to $137,600. This causes a decrease of $16,400 in net assets.

Net Assets = 154,000 + 47,600 - 64,000 = $137,600

Decrease amount = 154,000 - 137,600 = $16,400