Advanced Accounting
12th Edition
ISBN: 9781305084858
Author: Paul M. Fischer, William J. Tayler, Rita H. Cheng
Publisher: Cengage Learning
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Chapter 16, Problem 16.2.5P
To determine
Introduction: Funds refers to an amount of money which is set aside or saved by individuals, government, businesses for paying unforeseen expenses or for any other purpose. Debt service fund is used by government in accounting for the payment of principal & interest on debt raised.
To choose: The correct option from given options.
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Wood City, which is legally obligated to maintain a debt service fund, issued the following general obligation bonds on July 1, Year 1: Term of bonds 10 years, Face amount $1,000,000, Issue price 95 , Stated interest rate 6% Interest is payable January 1 and July 1. What amount of bond discount should be amortized in Wood's debt service fund for purposes of fund financial reporting for the year ended December 31, Year 1?
A.) $1,000
B.) $500
C.) $250
D.) $0
During fiscal year 2019, a municipality issued the following debt instruments:
Tax anticipation notes : $2,500,000
Utility bonds : 3,000,000
General obligation bonds : 8,000,000
How much of this debt should be reported in the fund financial statement?
Lisa County issued $5,000,000 of general obligation bonds at 101 to finance a capital project. The $50,000 premium was to be used for payment of interest. The transactions involving the premium should be accounted for in thea. capital projects funds, the debt service funds, and the general long-termdebt account group.b. capital projects funds and debt service funds only.c. debt service funds and the general long-term debt account group only.d. debt service funds only.
Chapter 16 Solutions
Advanced Accounting
Ch. 16 - Prob. 1UTICh. 16 - If a capital projects fund has authority to...Ch. 16 - Prob. 3UTICh. 16 - The debt service fund does not use budgetary...Ch. 16 - When a debt service fund receives resources, it...Ch. 16 - Prob. 6UTICh. 16 - Prob. 7UTICh. 16 - Prob. 8UTICh. 16 - Prob. 9UTICh. 16 - Prob. 10UTI
Ch. 16 - Describe the difference between accounting for...Ch. 16 - Prob. 12UTICh. 16 - Prob. 1.1ECh. 16 - Prob. 1.2ECh. 16 - Prob. 1.3ECh. 16 - Prob. 1.4ECh. 16 - Prob. 1.5ECh. 16 - Prob. 1.6ECh. 16 - Prob. 1.7ECh. 16 - Prob. 1.8ECh. 16 - Prob. 1.10ECh. 16 - Prob. 2.1ECh. 16 - Prob. 2.2ECh. 16 - Prob. 2.3ECh. 16 - Prob. 2.4ECh. 16 - Prob. 2.5ECh. 16 - Prob. 2.6ECh. 16 - Prob. 2.7ECh. 16 - Prob. 2.8ECh. 16 - Prob. 2.9ECh. 16 - Prob. 2.10ECh. 16 - Prob. 3.1ECh. 16 - Prob. 3.2ECh. 16 - Prob. 3.3ECh. 16 - Prob. 3.4ECh. 16 - Prob. 4ECh. 16 - Special assessments levy, capital projects fund....Ch. 16 - Prob. 6ECh. 16 - Prob. 7ECh. 16 - Prob. 8ECh. 16 - Prob. 9ECh. 16 - Prob. 10ECh. 16 - Prob. 11ECh. 16 - Prob. 12ECh. 16 - Prob. 16.1.1PCh. 16 - Prob. 16.1.2PCh. 16 - Prob. 16.1.3PCh. 16 - Prob. 16.1.4PCh. 16 - Prob. 16.1.5PCh. 16 - Prob. 16.1.6PCh. 16 - Prob. 16.1.7PCh. 16 - Prob. 16.1.8PCh. 16 - Prob. 16.2.1PCh. 16 - Prob. 16.2.2PCh. 16 - Prob. 16.2.3PCh. 16 - Prob. 16.2.4PCh. 16 - Prob. 16.2.5PCh. 16 - Prob. 16.2.6PCh. 16 - Prob. 16.2.7PCh. 16 - Prob. 16.12.1PCh. 16 - Prob. 16.12.2PCh. 16 - Prob. 16.13.1PCh. 16 - Enterprise fund, general fund. In 2018, a city...Ch. 16 - Prob. 16.13.3PCh. 16 - Prob. 16.14PCh. 16 - Prob. 16.15PCh. 16 - Prob. 16.16PCh. 16 - Prob. 16.18.1PCh. 16 - Prob. 16.18.3PCh. 16 - Prob. 16.18.4PCh. 16 - Prob. 16.18.5PCh. 16 - Prob. 16.18.6PCh. 16 - Prob. 16.18.7PCh. 16 - Prob. 16.18.8PCh. 16 - Prob. 16.18.9PCh. 16 - Prob. 16.18.10PCh. 16 - Prob. 16.19.2PCh. 16 - Prob. 16.19.3PCh. 16 - Prob. 16.19.4PCh. 16 - Prob. 16.19.5PCh. 16 - Prob. 16.19.6PCh. 16 - Prob. 16.19.9PCh. 16 - Prob. 16.19.11PCh. 16 - Prob. 16.19.12PCh. 16 - Prob. 16.19.13PCh. 16 - Prob. 16.19.14PCh. 16 - Prob. 16.19.15PCh. 16 - Prob. 16.19.16PCh. 16 - Prob. 16.19.17PCh. 16 - Prob. 16.19.18PCh. 16 - Prob. 16.19.19PCh. 16 - Prob. 16.19.20PCh. 16 - Prob. 16.19.21PCh. 16 - Prob. 16.19.22P
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- On March 2, 2018, Beloit City issued 10-year general obligation bonds at face amount, with interest payable on March 1 and September 1. The proceeds were to be used to finance the construction of a civic center over the period of April 1, 2018, to March 31, 2019. During the fiscal year ended June 30, 2018, no resources had been provided to the debt service fund for the payment of principal and interest.Proceeds from the general obligation bonds should be recorded in the a. general fund. b. capital projects fund. c. general long-term debt account group. d. debt service fund.arrow_forwardThe Town of Mercy has $14,000,000 in general obligation bonds outstanding and maintains a single debt service fund for all debt service transactions. On July 1, 2024, a current refunding took place in which $14,000,000 in new general obligation bonds were issued. Required: Record the transaction on the books of the debt service fund. Note: If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.arrow_forwardI need the journal entry for these questions As of January 1, 2020, the City of Monroe had $12,000,000 in general obligation bonds outstanding. Eliminate the expenditures for bond principal. Adjust for the interest accrued in the prior year government-wide statements, but recorded as an expenditure in the 2020 fund basis statements, ($12,000,000 × 0.03 × 6/12) = $180,000.arrow_forward
- Breneman City reported bonds payable of $5,500,000 in the governmental activities column of its statement of net position for fiscal year ended June 30, 2021. During fiscal year ended June 30, 2022, the City issued bonds payable totaling $1,000,000, and made principal payments on bonds payable totaling $220,000. Prepare the three journal entries required to adjust the governmental funds statements to the government-wide statements for fiscal year ended June 30, 2022.arrow_forwards The Village of Hawksbill issued $5,900,000 in 5 percent general obligation, tax-supported bonds on July 1, 2019, at 101. A fiscal agent is not used. Resources for principal and interest payments are to come from the General Fund. Interest payment dates are December 31 and June 30. The first of 20 annual principal payments is to be made June 30, 2020. Hawksbill has a calendar fiscal year. 1. A capital projects fund transferred the premium (in the amount of $59,000) to the debt service fund. 2. On December 31, 2019, funds in the amount of $147,500 were received from the General Fund and the first interest payment was made. 3. The books were closed for 2019. 4. On June 30, 2020, funds in the amount of $383,500 were received from the General Fund, and the second interest payment ($147,500) was made along with the first principal payment ($295,000). 5. On December 31, 2020, funds in the amount of $140,125 were received from the General Fund and the third interest payment was made (also in…arrow_forwardA city keeps its books on a calendar-year basis. On April 1, 2019, the city sold $500,000 of 2% general obligation bonds, payable in semi-annual installments. The first installment, due October 31, 2019 covered interest of $5,000 and principal of $10,000. For the year ended December 31, 2019, how much should the Debt Service Fund report as expenditures? $15,000 $5,000 $15,000, plus an accrual for three months' interest $5,000, plus an accrual for three months' interest and principalarrow_forward
- On March 2, 2018, Beloit City issued 10-year general obligation bonds at face amount, with interest payable on March 1 and September 1. The proceeds were to be used to finance the construction of a civic center over the period of April 1, 2018, to March 31, 2019. During the fiscal year ended June 30, 2018, no resources had been provided to the debt service fund for the payment of principal and interest.The liability for the general obligation bonds should be recorded in the a. general fund. b. capital projects fund. c. general long-term debt account group. d. debt service fund.arrow_forwardOn March 2, 2018, Finch City issued 10-year general obligation bonds at face amount, with interest payable on March 1 and September 1. The proceeds were to be used to finance the construction of a civic center over the period from April 1, 2018, to March 31, 2019.During the fiscal year ended June 30, 2018, no resources had been provided to the debt service fund for the payment of principal and interest. On June 30, 2018, in which statements should Finch report the construction in progress for the civic center? Capital Projects FundBalance Sheet Government-WideStatement of Net Position a. b. c. d. Yes Yes No No Yes No No Yesarrow_forwardRequired information [The following information applies to the questions displayed below.] As of December 31, 2019, Sandy Beach had $8,300,000 in 5.0 percent serial bonds outstanding. Cash of $443,000 is the debt service fund's only asset as of December 31, 2019, and there are no liabilities. The serial bonds pay interest semiannually on January 1 and July 1, with $500,000 in bonds being retired on each interest payment date. Resources for payment of Interest are transferred from the General Fund, and the debt service fund levies property taxes in an amount sufficient to cover principal payments. c. Prepare a balance sheet for the debt service fund as of December 31, 2020. Cash Total Assets SANDY BEACH Debt Service Fund Balance Sheet December 31, 2020 Assets Deferred Inflows of Resources Fund Balances S Total Deferred Inflows of Resources and Fund Balance S 0 0arrow_forward
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What is Fund Accounting?; Author: Aplos;https://www.youtube.com/watch?v=W5D5Dr0j9j4;License: Standard Youtube License