Waec Model Questions Vol1 2022 Financial Accounting Question 8

A municipal council's Education Services Fund was approved with a budget of ₦200,000,000 for the year ended 31 December 2025. During the year the fund recorded: • Revenue collected ₦180,000,000, of which ₦20,000,000 came from a special grant that must be spent only on capital projects. • Expenditure ₦150,000,000, comprising ₦30,000,000 capital expenditure and the remainder current expenditure. The fund therefore shows a surplus of ₦30,000,000 at year‑end. Council policy allows any surplus to be transferred to the General Fund provided that at least 10 % of the original approved budget (i.e., ₦20,000,000) remains in the Education Services Fund as a reserve for the next year. Determine the maximum amount that can be transferred to the General Fund and state whether the policy requirement is satisfied.