The fоllоwing аre fund bаlаnce classificatiоns described in Chapter 2: A. Nonspendable B. Spendable—Restricted C. Spendable—Committed D. Spendable—Assigned E. Spendable—Unassigned For each of the following scenarios, indicate how they would be classified for fund balance reporting purposes using the classification list above. Place the appropriate letter in the blank space next to each scenario. You may use the choices more than once or not at all. 1. Bond proceeds of $15,000,000 that must be used for construction of a fire substation remain unspent at the end of the fiscal year are [cat1]. 2. Prepaid rent of $6,000 remains at the end of the fiscal year and is categorized as [cat2]. 3. The mayor made a plan to set aside 2% of revenues over the next three years to help build cash reserves. At the end of the fiscal year 2% of the revenues were set aside. No formal ordinance was passed. These are categorized as [cat3]. 4. The transportation department provided $1,000,000 in state funds to be used for street widening. At the end of the fiscal year $750,000 remained unspent and was categorized as [cat4]. 5. The county received a $3,000,000 permanent endowment during the year and it was categorized as [cat5].
Hоw dоes the use оf encumbrаnce procedures improve budgetаry control over expenditures?