Question: The City of Southern Pines maintains its books so as to prepare fund accounting statements and records worksheet adjustments in order to prepare government-wide statements. As such, the City's internal service fund, a motor pool fund, is included in the proprietary funds statements. Prepare necessary adjustments in order to incorporate the internal service fund in the government-wide statements as a part of governmental activities.

1. Balance sheet asset accounts include: Cash, $150,000; Investments, $125,000; Due from the General Fund, $15,000; Inventories, $325,000; and Capital Assets (net), $1,340,000. Liability accounts include: Accounts Payable, $50,000; Long-Term Advance from Enterprise Fund, $800,000.

2. The only transaction in the internal service fund that is external to the government is interest revenue in the amount of $5,300.

3. Exclusive of the interest revenue, the internal service fund reported net income in the amount of $36,000. An examination of the records indicates that services were provided as follows: one-third to general government, one-third to public safety, and one-third to public works.