Question: The State of Alaska general government transactions for the fiscal

The State of Alaska general government transactions for the fiscal year ended June 30, 20X3, related to leases and certificates of participation are given here. Prepare the required General Fund General Ledger entries assuming that all lease payments for general government activities are made through the General Fund.
1. The state paid operating lease payments of $29,800,000.
2. The state entered into capital leases for equipment with a capitalizable cost of $8,628,000, making an initial payment of $500,000.
3. The state made payments of $21 million, including $6,600,000 of interest on its capital leases.
4. The state has lease purchase agreements funded through certificates of participation (COPs) for the purchase of buildings. Third-party leasing companies assigned their interest in the lease to underwriters, which issued certificates for the funding of these obligations. The COPs represent an ownership interest of the certificate holder in a lease purchase agreement. While the state is liable for lease payments to the underwriters, the state is not liable for payments to holders of the certificates. The state paid $13.2 million on the certificates of participation in 20X3, including $3.7 million of interest.

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  • CreatedOctober 25, 2014
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