The following balances were extracted from the books of Abobakau Local Government for the year ended 31st December 2019. Construction of an office block 3,8...

Answer Details

Statement of Recurrent Expenditure:

• Wages and salaries ------------------------7,880,450
• Medical services -------------------------1,334,650
• Rehabilitation of street lights ---------470,500
• Provision of pipe borne water -------2,500,000
• Interest on investments ----------------250,000
• Lorry park levies -------------------------380,000
• Market tolls ------------------------------560,000
• Property rates --------------------------1,200,000
• General administration -----------------630,700
• Entertainment expenses --------------200,000
• Staff training -----------------------------550,000
• Allowances to community leaders ---380,000
• Birth certificate fees --------------------160,000
• Maintenance of motor vehicles -----650,000

Total Recurrent Expenditure: ------- 16,166,300

Explanation:
Recurrent expenditure refers to the day-to-day running expenses of an organization that are incurred regularly, such as salaries, rent, utilities, and other expenses that are necessary for the organization's ongoing operations. The statement of recurrent expenditure shows the total amount spent on such expenses during the year. In this case, the total recurrent expenditure of Abobakau Local Government for the year ended 31st December 2019 was 16,166,300.

Statement of Capital Expenditure:

• Construction of an office block -----3,850,000
• Renovation of classroom blocks ---1,065,500
• Building permits -----------------------650,000
• Extension of office building ---------950,000
• Motor vehicle procured --------------6,653,000

Total Capital Expenditure: ------------12,168,500

Explanation:
Capital expenditure refers to the money spent on acquiring, constructing, or improving fixed assets, such as buildings, equipment, and land. The statement of capital expenditure shows the total amount spent on such assets during the year. In this case, the total capital expenditure of Abobakau Local Government for the year ended 31st December 2019 was 12,168,500.

Statement of Revenue:

• Court fines ------------------------------------90,000
• Interest on investments -------------------250,000
• Lorry park levies ------------------------------380,000
• Market tolls ------------------------------------560,000
• Property rates --------------------------------1,200,000
• Royalties ---------------------------------------4,500,000
• Subvention from Central/Fed govt ---20,000,000
• Grants from donor agencies ------------2,000,000
• Donations to charity homes --------------250,000
• Entertainment permits ---------------------70,000
• Marriage registration fees ----------------80,000

Total