Requirements: 1. (1) Prepare the journal entries required in a Capital Projects Fund to record these transactions, assuming the bond anticipation notes do not qualify for long-term debt treatment. If no entry is required, state "No entry required" and explain why. (2) Indicate the effects of each transaction on the accounting equation of the Capital Projects Fund and on the General Capital Assets and General Long-Term Liabilities accounts. If an element is not affected, put "NE" in the appropriate box.
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- A County had the following transactions. The county's fiscal year end is December 31. Analyze the effects of each transaction on the accounting equations of each fund or nonfund accounts affected by the transaction. 1. County issued $10 million of general obligation, 10%, 10-year bonds at 105 on October 1, 20X8. Bond interest is payable semiannually on March 31 and September 30. The bonds were issued to finance construction of a new county office building. 2. The county board of supervisors voted to use the premium on the bonds to pay principal and interest charges on the debt when it matures. Resources were transferred to the appropriate fund. 3. The county paid $2 million to Roger Construction Company during 20X8 for work completed during the year. 4. Reflect any interest accrual required or permitted at year end. 5. The county purchased a police vehicle for $22,000 and paid cash. 6. The county owned and operated electric utility billed residents and businesses $2,000,000 for…The City of Dylan issues a 10-year bond payable of $1 million at face value on the first day of Year 1. Debt issuance costs of $10,000 are paid on that day. For government-wide financial statements, how is this debt issuance cost reported? $1,000 is recorded as an expense and $9,000 is recorded as an asset. $1,000 is recorded as an expense and $9,000 is recorded as a deferred outflow of resources. $10,000 is recorded as an expense. $10,000 is recorded as an asset.The City of Dylan issues a 10-year bond payable of $1 million at face value on the first day of Year 1. Debt issuance costs of $10,000 are paid on that day. For government-wide financial statements, how is this debt issuance cost reported? Choose the correct.a. $1,000 is recorded as an expense and $9,000 is recorded as an asset.b. $1,000 is recorded as an expense and $9,000 is recorded as a deferred outflow of resources.c. $10,000 is recorded as an expense.d. $10,000 is recorded as an asset.
- (B) The City of Presho had the following transactions related to the construction of a new courthouse. (1) 1/2/2017: 20 year 4% General Obligation Serial Bonds with a face value of $5,000,000 are issued at 102. Interest and principle payments are made on Jan. 1 and July 1 of each year. The premium was transferred into the Debt Service Fund. The General Fund will fully fund each payment as they become due. (2) 3/1/2017: Land is purchased for a new courthouse at a cost of $300,000. (3) 3/1/2017: A contract is signed for construction of the new courthouse in the amount of $4,300,000. (4) 6/15/2017: Cash ($225,000) sufficient to cover interest and principal payments for the year less the premium is transferred from the General Fund. (5) 7/1/2017: Interest ($100,000) and principal ($125,000) are paid on the courthouse fund serial bonds. (6) 12/1/2017: Receive an invoice for progress completed to date on the courthouse construction project in the amount of $3,700,000. (7) 12/27/2017: $97,500…6. Franklin County issued $4,300,000, 3 percent serial bonds, paying interest on January 1 and July 1. The bonds were sold on June 1 for 102. The county is required to use all accrued interest and premiums to service the debt. Any additional resources needed to service the debt are to come from the General Fund. The county's fiscal year-end is December 31. Required Prepare in general journal form the budgetary entry the debt service fund would make to account for this serial bond issue. What, if any, adjustment would need to be made to the General Fund budget to account for this serial bond issue? Medium Answer Answer any TWO questions (2x 5 marks = 10 marks) Section B -The Town of Presho had the following transactions related to the construction of a new courthouse. (a) 1/2/2020: 20 year 4% General Obligation Serial Bonds with a face value of $6,000,000 are issued at 101. Interest and principle payments are made on Jan. 1 and July 1 of each year. The premium was transferred into the Debt Service Fund. The General Fund will fully fund each payment as they become due. (b) 3/1/2020: Land is purchased for a new courthouse at a cost of $250,000. (c) 3/1/2020: A contract is signed for construction of the new courthouse in the amount of $5,400,000. (d) 6/15/2020: Cash ($210,000) sufficient to cover interest and principal payments for the year less the premium is transferred from the General Fund. (e) 7/1/2020: Interest ($120,000) and principal ($150,000) are paid on the courthouse fund serial bonds. (f) 12/1/2020: Receive an invoice for progress completed to date on the courthouse construction project in the amount of $4,700,000. (g) 12/27/2020: $117,000 is…
- Yarrow County engaged in the following debt-related transactions during the year. REQUIRED: Assume that the county maintains its books and records in a manner that facilitates the preparation of its government-wide financial statements. Prepare the necessary journal entries to record these transactions. Clearly indicate if debt is long-term or short-term (current). If no entry is required, write “No entry required.” a)The county issued $10 million in 6 percent, 20-year bonds for $10,234,932 to yield 5.8 percent (2.9 percent per semi-annual period) to the investor. b)The county made the first semi-annual interest payment on the bonds in (a). c)The county issued $3 million in 6 percent demand bonds for which it did not enter into a take-out agreement. d)In anticipation of finally issuing $20 million in bonds that were approved by the voters several months ago, the county borrowed $20 million from a consortium of national banks due in six months. The county also entered into a…Prepare journal entries to record the following transactions in the capital projects fund and the government-wide financial statements (governmental activities). Please write "no entry" for any transactions that no journal entries is required. Please show your calculation where necessary. 1. A local government sold serial bonds in the amount of $120,000,000 to finance the construction of an administrative building. The bonds were sold at par on March 2. The annual interest rate is 5% with semiannual interest payments on March 1 and September 1. 2. Shortly thereafter a construction contract in the amount of $62,000,000 was signed and the contractor commenced work. 3. The government made an interest payment on Sep 1. 4. The contractor has billed the local government of $42,000,000 on Dec 31. 5. Prepare the adjusting entries if necessary. 6. Prepare closing entries if necessary.The City of McNeely sold bonds in the amount of $25,000,000 to finance the construction of a public health center. The bonds are serial bonds and were sold at par on January 1, the first day of a fiscal year. Shortly thereafter a construction contract in the amount of $22,000,000 was signed and the contractor commenced work. By year-end the contractor had been paid in full for all billings to date amounting to $12,000,000. Prepare, in general journal form, all journal entries that should have been made during the fiscal year ended December 31 to record the preceding information in the capital projects fund. View transaction list 1 Record the issuance of the bonds. 2 Record the inception of the construction contract. 3 Record the receipt of the construction billing. 4 Record the closing entry. Credit
- City ‘A’ issued OMR 2,750,000, 1.5 percent serial bonds, paying interest on January 1 and July 1. The bonds were sold on June 1 for 102. The city is required to use all accrued interest and premiums to service the debt. Any additional resources needed to service the debt are to come from the General Fund. The city’s year-end is December 31. Required: Prepare in general journal form the budgetary entry the debt service fund would make to account for this serial bond issue.Assume that a city issues a $5,250,000 bond at par. The city, subsequently, pays $262,500 in interest on the bond and $1,050,000 of the principal. Prepare the journal entries to record the issuance of the bond and the subsequent payments.The town of McHenry Has $10,000,000 in general obligation bonds outstanding and maintains a single debt service fund for all debt service transactions. On july 1, 2020, a current refunding took pace in which $10,000,000 in new general obligation bonds were issued. Record the transaction on the books of the debt service fund.