The general principles of revenue recognition are the same for both govermental and government-wide statements.

For eAch of the following situations, indicate the amount of revenue that the government should recognize in an appropriate governmental fund as well as in its government-wide statement of activities in its fiscal year ending December 31, 2018. Briefly justify your response, making certain that, as appropriate, you identify the key issue of concern.

1. In October 2017 a state received a federal grant of $300 million (cash) to assist local law enforcement efforts. The federal government has established specific criteria governing how the funds should be distributed, and will monitor the funds to ensure that they are in accordance with grant provisions. The grant is intended to cover any allowable expenditure incurred in the calendar years 2018 through 2019. In 2018 the state incurred $160 million of allowable expenditures.

2. In December 2017 a city levied property taxes of $500 million for the calendar year 2018. The txes are June 30, 2018. The city collects the taxes as follows:

December 2017                                                                                                                                           $30 million

January 1, 2018 to December 31, 2018                                                                                                          $440 million

January 1, 2019 through March 31, 2019 ($8 million per month)                                                                        $24 million

Total                                                                                                                                                            $494 million

It estimates the balance will be uncollectible.

3. In January 2018 a city received a cash gift of $1 million to support its museum of city history. Per the wishes of the donor the funds are to be invested and only the income may be expended. In 2018, the endowment genereated $50,000 in income, none of which was spent during the year.

4. For the year 2018 the teachers of the Nuvorich School District earned $26 million in pension benefits. In January 2019, the state in which the district is located paid the entire amount into the State Teachers Retirement Fund.