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

Use the following to answer the next five questions: On October 1, 2014, the City of Mizner issued $4,000,000 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 $3,975,000 was used to construct the addition, which was completed prior to June 30, 2015. The remaining funds were transferred to the debt service fund. The bonds were dated October 1, 2014, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $200,000 is due October 1, 2015. The fiscal year for Mizner is July 1- June 30. -In addition to a capital asset in the government-wide Statement of Net Position,how would the construction costs of $3,975,000 be reported at year-end?

An encumbrance in a capital project fund is created

Which of the following lease criteria would not qualify a lease as a capital lease?

Which of the following funds typically record budgets?

When a purchase order is issued under a Capital Projects fund,how should the transaction be recorded?

The residual classification for governmental funds other than the General Fund is Assigned.

Capital project funds record the proceeds of debt issued as:

Budgets are typically recorded for Debt Service Funds.

What is the correct debit or credit for the following scenario: A contract was issued for the major part of work to be done by a private contractor in the amount of $1,200,000 for a new County court house?

Because debt service and permanent funds use modified accrual accounting,these funds would typically record encumbrances.

Use the following to answer the next four questions: On April 1, 2015, the City of Southern Ponds issued $3,500,000 in 4% general obligation, tax supported bonds at 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,490,000 was used to construct the police station, which was completed before December 31, 2015, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2015, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $175,000 is due April 1, 2016. -What amount would be reported as debt service expenditures for 2015?

Use the following to answer the next four questions: On April 1, 2015, the City of Southern Ponds issued $3,500,000 in 4% general obligation, tax supported bonds at 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,490,000 was used to construct the police station, which was completed before December 31, 2015, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2015, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $175,000 is due April 1, 2016. -How would the $3,490,000 be accounted for?

All of the governmental funds except permanent funds use the modified accrual basis of accounting

Fund basis financial statements in which capital projects funds are reported are the Governmental Funds Balance Sheet and the Governmental Funds Statement of Revenues,Expenditures,and Changes in Fund Balances.

The current and long-term portions of General Long-term Debt are normally reported in a debt service fund.

A construction contract was issued for an addition to the county jail in the amount of $2,300,000. When the project was approximately half finished,the contractor submitted an invoice for payment of $1,150,000. Which partial entry below is not required to record this transaction?

What would be the amount of debt service expenditures reported in the fiscal year ended June 30,2016?

Where should a government report special assessment debt that the government is not liable for in any way?

If bonds issued to fund a capital project are sold at a premium,the additional money received is:

If a bond sinking fund is required by creditors or law,the unexpended resources would be classified as Restricted.