On February 1 20X3 Mobiline County acquired the following

assets
On February 1, 20X3, Mobiline County acquired the following assets of Mobiline Transit, Inc., a
privately owned bus line in financial difficulty, with the intent of establishing a county bus service
for its residents:1. The purchase was financed through the issue of 6% general obligation notes
payable, scheduled to mature in amounts of $30,000 each February 1 for 10 years. Interest is
payable annually each February 1.2. Bus line revenues and expenditures are initially being
accounted for through the General Fund. The capital assets acquired and the notes payable
were recorded in the General Capital Assets and General Long-Term Liabilities accounts.3. The
buses had remaining useful lives of 5 years and the buildings and shop equipment had
remaining useful lives of 10 years when acquired.4. As of its fiscal year end (October 31, 20X3),
the County had $3,000 of tires and parts on hand. Also, as of October 31, 20X3, the County
was owed $1,000 by a local nonprofit agency for a special charter that was provided on October
20, 20X3.5. The county’s finance officer attempted to prepare an operating statement for the
bus line’s operations as of October 31, 20X3, using the information accounted for within the
General Fund, as follows:Requireda. Briefly analyze the propriety of Mobiline County using the
General Fund to account for the operations of the bus service. How would the bus line’s
operations reflect a different “bottom line” if the activity were being accounted for in an
Enterprise Fund?b. Prepare an accrual basis operating statement of revenues and expenses for
Mobiline County Bus Line for the 9-month period ending October 31,20X3. View Solution: On
February 1 20X3 Mobiline County acquired the following assets
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