Construction Fund. During FY 2011, the voters of the Town of Dex approved constructing and equipping a recreation center to be financed by tax-supported bonds in the amount of $3,000,000. During 2011, the following events and transactions occurred.
1. Preliminary planning and engineering expenses in the amount of $60,000 were incurred. No money was immediately available for paying these costs (credit Vouchers Payable).
2. A contract was let under competitive bids for a major segment of the construction project in the amount of $2,500,000.
3. An invoice for $1,600,000 was received from a contractor for a portion of work that had been completed under the general contract.
4. The bond issue was sold at par plus accrued interest of $25,000 (the accrued interest was deposited in the fund that will service the bonded debt).
5. The contractor’s bill, less a 4 percent retention, was vouchered for payment.
6. All vouchers payable, except $1,300 (about which there was some controversy), were paid.
7. Fiscal year-end closing entries were prepared.
Required
a. Prepare journal entries to record the preceding information in the Town of Dex Recreation Center Construction Fund and the governmental activities general journal at the government-wide level.
b. Prepare a Town of Dex Recreation Center Construction Fund balance sheet for the year ended December 31, 2011.
c. Prepare a Recreation Center Construction Fund statement of revenues, expenditures, and changes in fund balance for the year ended December 31, 2011.
d. How would these capital expenditures for the recreation center appear on the Town of Dex’s government-wide statements of net assets and activities?