Voters in Lincoln School District approved the construction of a new high school and approved a $10 million bond issue with a stated rate of interest of 6% to fund the construction. Bids were received and the low bid was $10 million. When the bonds were issued, they sold for face value less bond underwriting fees of $.5 million. The School Board voted to fund the balance of the construction by a transfer from the general fund. The entry in the capital project fund to record the additional funding for the construction would be
The City of Williamsburg decided to defease old 6% bonds carried in its Electric Enterprise Fund with new 4.5% bonds. As a result of the defeasance, the City incurred an accounting loss. This loss should be recognized
Harbor City issued 6% tax-exempt bonds and used the proceeds to acquire federal government securities yielding 7%. After paying the interest on the tax-exempt bonds, the City cleared 1%. This is an example of
Salt City issued $5 billion of bonds at face value to fund the reconstruction of the major interstate highways in and around their city. The bond underwriters withheld $2 million for underwriting fees and remitted the balance to the City. Assuming the City maintains its books and records in a manner that facilitates the preparation of fund financial statement, how would the underwriting fee be accounted for in the capital project fund?
Calhoun County makes annual transfers from the general fund to the debt service fund to pay principal and interest on long-term debt. When the County makes the transfer the entry in the debt service fund should be
General fixed assets are excluded from governmental funds because
With regard to capitalization of infrastructure, which of the following is true?
For a government that elects NOT to capitalize its works of art and similar assets, the appropriate entry when receiving a contribution of a work of art at the government-wide level is
If a government receives a donation of a work of art, the government must recognize revenue
Which of the following costs will be included in the cost of land on the government-wide financial statements?
Which of the following is likely to be used by a bond-rating agency to rate the general obligation bonds of a governmental entity?
Sun City is located in Hailey County. Sun Valley School District encompasses all of Sun City and some of Hailey County. Property in Sun City is assessed at $400 million; property in Hailey County is assessed at $800 million; property in Sun Valley School District is assessed at $600 million. The total debt outstanding for Sun City is $30 million; Hailey County is $50 million; Sun Valley School District is $45 million. Compute the amount of direct and overlapping debt for Sun City.
In the government-wide financial statements, the assets acquired under a capital lease would be reported at
The City of Pocahontas issued $20 million in general obligation bonds at par. The City loaned the proceeds to Domsee Fish Processors to expand the size of their facility, which would allow Domsee to hire additional workers. The loan payments from Domsee to the City are established to match the principal and interest payments on the bond issue. The bonds are payable exclusively from the loan repayments by Domsee. The bonds are secured by the additional plant facilities built by Domsee. Where should the City report the bonds on the annual financial report?
Southwest City enters into a lease agreement that contains a nonappropriation clause. The clause
Over the long run, governmental internal service funds are intended to
Which of the following are required basic statements of a proprietary fund?