Advanced Accounting 5th Edition Chapter 18 question 13 Authors: Debra Jeter and Paul Chaney

Preparing Government-wide Financial Statements: Circus City issued an 8%, 10-year $2,000,000 bond to build a monorail mass transit system. The city received $1,754,217 cash from the bond issuance on January 1, 2012. The bond yield is 10%. Interest is paid annually on December 31 of each year. Disclosure information about capital assets is reported below.

Circus City
Governmental Funds
Fund Bal Sheet Dec 31,2012
Assets	General Fund	Monorail Fund	Term Bond
Cash	64,000	300,000		364,000
Interest Receivable		12,000	4,000	16,000
Investments	100,000	1,250,500	100,000	1,450,500
Property Tax Receivable	183,000			183,000
Total Assets	347,000	1,562,500	104,000	2,013,500
Liabilities & Fund Bal
Vouchers Payable	73,000	50,000		123,000
Total Liabilities	73,000	50,000		123,000
Fund Balances
Unreserved	83,000	312,500		395,500
Reserved for Encumberances	191,000	1,200,000		1,391,000
Debt Service			104,000	104,000
Total Fund Balance	274,000	1,512,500	104,000	1,890,500
Total Liabilities and Fund Balances	347,000	1,562,500	104,000	2,013,500

		Capital Projects Fund	Debt Service Fund	Total Government Funds
	General Fund	Monorail Fund	Term Bond
Revenues
Property Taxes	525,000		50,000	575,000
Licenses & Permits	150,000			150,000
State Grant-Highways & Streets	250,000			250,000
Intergovernmental- State Grant		1,000,000		1,000,000
Charges for Services	130,000			130,000
Investment Earnings	75,000			75,000
Total Revenue	1,130,000	1,000,000	50,000	2,180,000
Expenditures
Public Safety	500,000			500,000
General Govt	300,000			300,000
Highways & Streets	130,000			130,000
Sanitation	70,000			70,000
Debt Service
Interest			160,000	160,000
Capital Outlay		1,500,000		1,500,000
Total Expenditures
Excess of Revenues over Expenditures	130,000	(500,000)	(110,000)	(480,000)
Other Financing Sources
Proceeds from Long-Term
Capital Debt		1,754,217		1,754,217
Transfers In			160,000	160,000
Transfers Out	(160,000)			(160,000)
Total Other	(160,000)	1,754,217	160,000	1,754,217
Special Items
Proceeds from Sales of
Equipment	115,000			115,000
Net Change in Fund Bal	85,000	1,254,217	50,000	1,389,217
Fund Bal-Beg	189,000	258,283	54,000	501,283
Fund Bal-Ending	274,000	1,512,500	104,000	1,890,500

*Revenues from licenses and permits are assigned to highways and streets (100,000) and to the general govt (50,000)

Using the information above, prepare the statement of activities and the statement of net assets on a government-wide basis (using full accrual accounting). The beginning fund balance in the government-wide Statement of Net Assets is $2,686,283.