Problem 7-3 (a)

(a) Bond issue not approved by voters until 20X9BANs are CPF liabilities
20X8 1.

Cash ...............................................................................
BANs Payable ........................................................

2,000,000

ENCUMBRANCES ......................................................
ENCUMBRANCES OUTSTANDING...................

4,000,000

3a. ENCUMBRANCES OUTSTANDING .........................

ENCUMBRANCES ...............................................

1,800,000

3b. Construction Expenditures .............................................

Contracts PayableRetained Percentage ..............
Cash ........................................................................

1,800,000

2.

Non Fund
Construction in Progress.....................................................
Net Investment..............................................................
12/31 3c. Expenditures (Interest) ($2,000,000 x .09 x 6/12).........
Accrued Interest Payable ........................................
20X9 4.

Cash ...............................................................................
ExpendituresBond Issue Costs...................................
Other Financing SourcesBonds ..........................
Other Financing SourcesBond Premium.............

Non Fund
Net Investment.....................................................................
Unamortized bond issue costs.............................................
Bond Payable.................................................................
Bond Premium..............................................................

2,000,000
4,000,000
1,800,000
90,000
1,710,000
1,800,000
1,800,000
90,000
90,000
4,180,000
120,000
4,000,000
300,000
4,180,000
120,000
4,000,000
300,000

Problem 7-3 (a) (continued)

20X9 5. BANs Payable ................................................................
Accrued Interest Payable ...............................................
Expenditures (Interest) ...................................................
Cash ........................................................................

2,000,000
90,000
45,000
2,135,000

6a. ENCUMBRANCES OUTSTANDING .............

ENCUMBRANCES ...............................................

2,200,000

6b. Construction Expenditures .............................................

Contracts PayableRetained Percentage ......................
Cash ........................................................................
Non Fund
Building.................................................................................
Construction in Progress..............................................
Net Investment..............................................................

2,200,000
90,000

2,200,000

2,290,000
4,000,000
1,800,000
2,200,000

6c. Other Financing UsesTransfer to Debt

Service Fund.......................................................
Cash.........................................................................

45,000
45,000

Non Fund Depreciate Building, Amortize premium and BIC for portion of year

Rhea County
Baseball Stadium Capital Projects Fund
Statement of Revenues, Expenditures, and Changes in Fund Balance
For Years Ended December 31, 20X8 and 20X9
Revenues: ..........................................................................................
Expenditures:
Construction ...............................................................................
Bond Issue Costs.........................................................................
Interest .......................................................................................
Excess of Revenues over (under) Expenditures.................................
Other Financing Sources (Uses):
Bonds .........................................................................................
Bond Premium............................................................................
Transfer to Debt Service Fund....................................................
Total Other Financing Sources and Uses ..........................................
Net Change in Fund Balance ............................................................
Fund BalanceBeginning of Year ...................................................
Fund BalanceEnd of Year .............................................................

20X8

20X9
$

1,800,000
90,000
1,890,000
(1,890,000)

2,200,000
120,000
45,000
2,365,000
(2,365,000)

(1,890,000)

$(1,890,000)

4,000,000
300,000
(45,000)
4,255,000
1,890,000
(1,890,000)
$

Problem 7-3 (a) (continued)

Rhea County
Baseball Stadium Capital Projects Fund
Balance Sheet
December 31, 20X8 and 20X9
20X8
Assets
Cash ...................................................................................................
Liabilities:
BANs Payable ...................................................................................
Contracts PayableRetained Percentage .........................................
Accrued Interest Payable ..................................................................
Fund Balance:
Unassigned ........................................................................................

$ 290,000

20X9
$

2,000,000
90,000
90,000
2,180,000

(1,890,000)
$ 290,000

Problem 7-3 (b)

BANs treated as long-term debt
Solution Note:The solution to part a is comprehensive, so the solution to part b
emphasizes the differences between part b and part a.
20X8 1.

Cash ...............................................................................
Other Financing SourcesBANs ..........................

Non Fund
Net Investment.....................................................................
BAN Payable.................................................................
2.
3a.
3b.
3c.
20X9 4.
5.

2,000,000
2,000,000
2,000,000
2,000,000

Same as in part a.
Same as in part a.
Same as in part a.
No entryinterest not accrued on BAN recorded in GCA-GLTL accounts.
Same as in part a.
Other Financing UsesBAN Retirement......................
Expenditures (Interest)....................................................
Cash.........................................................................
To record payment of BANs and interest.

Non Fund
BAN Payable.........................................................................

2,000,000
135,000
2,135,000
2,000,000

Net Investment..............................................................
6a. Same as in part a.
6b. Same as in part a.
6c. Same as in part a.

2,000,000