The budgeted excess of estimated revenues over appropriations will be recorded as which of the following?

• A. Credit to Budgetary Fund Balance, $300,000
• B. Debit to Estimated Revenues, $300,000
• C. Credit to Revenues, $300,000
• D. Debit to Appropriations, $300,000

Answer: (D)

Budgetary accounting in governmental funds uses Estimated Revenues and Appropriations as control accounts. When the budget shows estimated revenues greater than appropriations, that excess is not recorded as revenue or a separate fund balance; it is an adjustment within the budgetary accounts to bring the two totals into balance. The appropriate action is to reduce spending authority by debiting Appropriations for the excess amount and to offset that by crediting Estimated Revenues. So, the entry would include a debit to Appropriations for 300,000 (with a corresponding credit to Estimated Revenues for 300,000). The other options would misstate the nature of the adjustment: they would affect Revenues or create a separate budgetary balance rather than properly balancing the budgetary control accounts.