In the financial statement accounts, which entry is made when city departments issue purchase orders for goods and services?

When city departments issue purchase orders for goods and services, the correct entry involves debiting the Encumbrances Control account. This is because issuing a purchase order represents a commitment to spend money and indicates that there will be an obligation or encumbrance against the budgeted funds.

By debiting the Encumbrances Control, the city is effectively recording the anticipated future expenditure which decreases the available budget amount for that department. This process ensures that resources are allocated appropriately and that there is accountability for spending within the jurisdiction. Encumbrances help in tracking budgetary performance and managing expected future expenditures.

The entry for encumbrances is an important aspect of governmental accounting as it assists in financial reporting and maintaining budget integrity. The other choices mentioned do not appropriately reflect the nature of the transaction regarding the commitment made through issuing a purchase order.