Exam 5: Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Siler City receives a trust donation for the purpose of maintaining flower beds in city parks,but the donor does not specify that the principal must be maintained.This type of trust would be most appropriately accounted for in a:

Use the following to answer the next five questions: On October 1, 2013, the City of Mizner issued $3,500,000 in 4%, general obligation bonds at 101 for the purpose of constructing an addition to City Hall. The premium was transferred to a debt service fund. A total of $3,475,000 was used to construct the addition, which was completed prior to June 30, 2014. The remaining funds were transferred to the debt service fund. The bonds were dated October 1, 2013, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $175,000 is due October 1, 2014. The fiscal year for Mizner is July 1- June 30. -In addition to a capital asset in the government-wide Statement of Net Assets,how would the construction costs of $3,475,000 be reported at year-end?

A government entered into a capital lease agreement to acquire equipment for the general government on January 1, 2014. Five payments of $8,000 each are to be made, beginning on December 31, 2014. Discounting is at 6%, computed annually. The present value of the five payments is $33,699. -Which of the following is/are true regarding Capital Projects Funds?

Budgets are typically not recorded for Capital Projects Funds.

If a trust is to be used for the benefit individuals,private organizations or other governments,the following fund(s)should be used:

The journal entry for the Debt Service fund upon the receipt of money from the General Fund would be:

If taxes and/or special assessments are levied specifically for payment of interest and principal on long-term debt,those taxes are recognized as revenues of the debt service fund.

Use the following to answer the next six questions: During the fiscal year ended December 31, 2014, the City of Johnstown issued 6% general obligation serial bonds in the amount of $3,000,000 at 102 ($3,060,000) and used $2,970,000 of the proceeds to construct a fire station. The $60,000 premium was transferred to a debt service fund. The $30,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2014 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2015. -What would be the amount of expenditures recorded by the debt service fund for the fiscal year ended December 31,2014?

How would the government account for the unused bond proceeds?

Which of the following would be accounted for as a permanent fund?

Which of the following statements regarding serial bonds is false?

A gift of $1,000,000 to a city,to be invested permanently,with the proceeds to be used to maintain the city war memorials should be accounted for in a permanent fund.