A city government has a nine-year capital lease for property being used within the General Fund.

The lease was signed on January 1, 2010. Minimum lease payments total \($90,000\) starting at the end of the first year but have a current present value of \($69,000.\) Annual payments are \($10,000,\) and the interest rate being applied is 10 percent. When the first payment is made on December 31, 2010, which of the following recordings is made?

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Government-Wide Statements a. Interest Expense $-0- b. Interest Expense $6,900 c. Expenditures $10,000 d. Interest Expense $6,900 Fund-Based Statements Interest Expense $-0- Expenditures $6,900 Expenditures $10,000 Expenditures $10,000