a. It levied and collected property taxes of $110 million. b. It issued $30 million in long-term...

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a. It levied and collected property taxes of $110 million. b. It issued $30 million in long-term bonds to construct a building. It placed the cash received in a
 special fund that was set aside to account for the bond proceeds. c. During the year, it constructed the building at a cost of $25 million. It expects to spend the
 $5 million balance in the following year. The building has an estimated useful life of 25 years. d. It incurred $70 million in general operating costs, of which it
 paid $63 million. It expects to pay the balance early the following year. e. It transferred $12 million from its general fund to a fund established to account for
 resources that were set aside to service the debt. Of this amount, $10 million was for repayment of the debt; $2 million was for interest. f. From the special fund
 established to service the debt, it paid $2 million in interest and $6 million in principal. g. It collected $4 million in hotel taxes restricted to promoting
 tourism. Because the resources were restricted, they were accounted for in a special restricted fund. During the year, the district spent $3 million on promoting
 tourism. h. The district established a supplies store, to provide supplies to the district s various departments, by transferring $4 million from the general fund.
 It accounted for the store in a proprietary fund. During the year, the store purchased (and paid for) $2 million in supplies. Of these, it sold $1 million, at cost
 (for cash), to departments accounted for in the general fund. During the year, these departments used all of the supplies that they had purchased. 1. Prepare
 journal entries to record the transactions and other events in appropriate funds. Assume that governmental funds are accounted for on a modified accrual basis, and
 focus only on current financial resources (and, therefore, do not give balance sheet recognition to either capital assets or longterm debt). Proprietary funds are
 accounted for on a full accrual basis. 2. Prepare a combined balance sheet one that has a separate column for each of the funds that you established. 3. Prepare a
 combined statement of revenues, expenditures, and changes in fund balances for all governmental funds one column for each fund. Prepare a separate statement of
 revenues, expenses, and changes in fund balances for any proprietary funds that you established.

David · Accepted Answer

a. Journal entries  
1. General fund 
Cash  $110 
Tax revenue  $110 
To record property tax revenue
2. Capital projects fund 
Cash  $  30 
Proceeds from bonds  $  30 
To record issuance of bonds
3. Capital project funds 
Expenditure for building $  25 
Cash   $  25 
To record construction of building
The district would also have to keep a record of the $25 asset that it created.
4. General fund 
Operating expenditures $  70 
Cash   $  63 
Accounts payable   7 
To record operating expenditures
5. General fund 
Transfer to debt service fund $  12 
Cash   $  12 
To record transfer to debt service fund
 Debt service fund 
Cash  $  12 
Transfer from general fund  $  12 
To record transfer from general fund
6. Debt service fund 
Interest expenditure $    2 
Payment of principal (expenditure)       6 
Cash   $    8 
To record payment of interest
In its record of long-term debts, the district would have to note a reduction of $10.
7. Special revenue fund 
Cash  $    4 
Hotel taxes  $    4 
To record hotel taxes
Tourism expenditures $    3 
Cash   $    3 
To record tourism expenditures
8.

a. It levied and collected property taxes of $110 million. b. It issued $30 million in long-term bonds to construct a building. It placed the cash received in a special fund that was set aside to...

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