Simple City has recorded the purchase order of two trucks for a total of $100,000.Prepare the journal entries to reflect that the two trucks have been received with an invoice amount of $105,000. This invoice has been approved but not yet paid. Identify the fund in which the entries are recorded.
What will be an ideal response?
In General fund:
| Encumbrances outstanding | 100,000 | |
| Encumbrances - Trucks | 100,000 | |
| Expenditures - Trucks | 105,000 | |
| Vouchers (or Accounts) payable | 105,000 | |
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What will be an ideal response?
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