713.The City of Sweetwater maintains an Employees Retirement Fund a single-employer defined benefit plan that provides annuity and disability benefits. The fund is financed by actuarially determined contributions from the citys General Fund and by contributions from employees. Administration of the retirement fund is handled by General Fund employees and the retirement fund does not bear any administrative expenses. The Statement of Fiduciary Net Position for the Employees Retirement Fund as of July 1 2014 is shown here:
Page 221
CITY OF SWEETWATEREmployees Retirement FundStatement of Fiduciary Net Position As of July 1 2014
During the year ended June 30 2015 the following transactions occurred:
1. The interest receivable on investments was collected in cash.
2. Member contributions in the amount of $250000 were received in cash. The citys General Fund also contributed $750000 in cash.
3. Annuity benefits of $700000 and disability benefits of $150000 were recorded as liabilities.
4. Accounts payable and accrued expenses in the amount of $900000 were paid in cash.
5. Interest income of $240000 and dividends in the amount of $40000 were received in cash. In addition bond interest income of $60000 was accrued at year-end.
6. Refunds of $133000 were made in cash to terminated nonvested participants.
7. Common stocks carried at a fair value of $500000 were sold for $480000. That $480000 plus an additional $300000 was invested in stocks.
8. At year-end it was determined that the fair value of stocks held by the pension plan had decreased by $40000; the fair value of bonds had increased by $35000.
9. Nominal accounts for the year were closed.
a.Record the transactions on the books of the Employees Retirement Fund.
b.Prepare a Statement of Changes in Fiduciary Net Position for the Employees Retirement Fund for the Year Ended June 30 2015.
Page 222
c.Prepare a Statement of Fiduciary Net Position for the Employees Retirement Fund as of June 30 2015.