Harvey City Comprehensive Case
Transaction and Events 20X4 Parks and Recreation capital projects fund

1. The city approved a major capital improvement project to construct a recreational facility. The project will be financed by a bond issue of $1,500,000, transfers from the General Fund of $500,000, and a contribution from the county of $300,000. Record the budget assuming these amounts, along with an equal appropriation for the project, were adopted for 20X4.

2. The city received the county’s contribution of $300,000. These resources are required to be used for the construction project. (The grant is expenditure-driven. The city’s policies indicate that resources restricted for a given purpose are considered expended prior to any unrestricted resources available for that purpose.)

3. The city transferred $200,000 from the General Fund to the Parks and Recreation Capital Projects Fund.

4. The city issued bonds with a face (par) value of $1,500,000 at a premium of $50,000 on January 1. Bond issue costs of $15,000 were incurred. The interest of 8% per year and $100,000 of principal are due each December 31.

5. The city signed a $2,190,000 contract for construction of the new recreational facility. The process to establish the contract qualifies as a commitment under the city’s commitments policy.

6. The city purchased land as the site for the facility at a cost of $110,000. Payment was made for the land.

7. The contractor billed the city $1,200,000. The city paid all but a 5% retainage.

8. The outstanding encumbrances were closed (use the transactions columns for this entry).

Answer rating: 100% (QA)

1 Est fund bond issue 15 00000 Est Fund General fund 500000 Est fund countrys contribut... View the full answer