50.1K

Verified Solution

Link Copied!

Continuing Problem Part C (1)-Chapter 6 Jounal entries for Capital Projects Fund transactions At the start of 2019, Croton's Capital Projects Fund had no assets or liabilities. Prepare appropriate journal en- tries to record these transactions in the Capital Projects Fund. (We suggest you post the journal entries to general ledger T-accounts.) 1. Croton undertook construction of a new police station, designed to house both the Croton police and the county sheriff and to serve as a detention center. To finance construction, Croton received a cash grant of $1,000 from the county as an advance pending incurrence of expenditures. It also sold $2,000 of 20-year general obligation bonds. The bonds, sold April 1,2019, were to be redeemed in equal semiannual install- ments of principal, with interest on the unpaid balance at the rate of 5 percent per annum, starting October 2. Croton awarded two contracts, one for architectural and construction supervision services ($200) and one 3. The construction contract was completed in a timely manner, and the contractor submitted an invoice for 4. All constraction and construction supervision work was completed. The construction architect/supervisor 1, 2019 for construction ($2,800) $2,800. The invoice was paid, except that 5 percent was withheld, pending completion of inspection. was paid in full, and the contractor was paid the balance due. Part C (2)- Chapter 6 -Journal entries for Debt Service Fund transactions At the start of 2019, Croton's Debt Service Fund had no assets or liabilities. Prepare appropriate journal entries General Fund. (We suggest to record these transactions in the Debt Service Fund and where appropriate, in the you post opening balances and the journal entries to general ledger Taccounts.) l. The General Fund transferred S1,200 cash to the Debt Service Fund. 2. The first installment of principal and interest on the bonds sold in Part C (I) came due for payment. 3. The principal and interest due for payment were paid 4. Debt service on bonds sold by Croton in previous years came due and was paid. Principal and interest pay- ments on those bonds were $600 and $470, respectively Chapter 6 Case Study-Having Faith in "Full Faith and Credit" Debt The text states (page 6-2) that governments typically finance their capital projects with general obligation deht secured by the "full faith and eredit" of f

Answer & Explanation Solved by verified expert

See Answer