A city encumbers $15,000 in Year 1 for a computer server, and the actual cost incurred in Year 2 is $12,000. Assuming the encumbrance was carried over, the impact on unreserved fund balance is:
a. Year 1: increase $15,000; Year 2: decrease $12,000
b. Year 1: decrease $15,000; Year 2: increase $3,000
c. Year 1: no effect; Year 2: decrease $12,000
d. Year 1: decrease $15,000; Year 2: decrease $12,000