3. Assume that Blackfoot County maintains its books and records in a manner that facilitates the preparation of fund financial statements. The county engaged in the following transactions during the current month. Prepare journal entries in the general fund to record these events.
a. Paid salaries to county employees, $100,000.
Borrowed $35,000 on a three-year note from a local bank to buy a county car.
Purchased the county car for $35,000.
Made a $7,000 payment on outstanding accounts payable.
Collected $3,500,000 of the current property tax levy.
Received a $50,000 grant from the State to support general government activities.
4. Kayla Township issued the following bonds during the year:
· Ten-year bonds to acquire equipment for a data
processing service reported in an internal service fund $2,000,000
· Bonds to construct a new police station $9,000,000
· Bonds to increase the capacity of the water treatment
plant reported in an enterprise fund $4,800,000
a. The amount of debt reported in the Townships general fund is:
1. $0
2. $9,000,000
3. $11,000,000
4. $15,800,000
b. The township should report depreciation expense on related new capital assets in:
1. General fund
2. Enterprise fund
3. Enterprise and internal service funds
4. Capital projects fund
c. The bonds issued to construct the new police station should be reported as:
1. Debt proceeds in the general fund
2. Long-term debt in a debt service fund
3. Debt proceeds in a capital projects fund
4. None of the above
d. In accordance with bond covenants the township sets aside $1,000,000 to help ensure that it is able to meet its first payment of principal and interest on the police station debt due one year from the date the bonds were issued. The amount of liability that the township should report in its debt service fund is:
1. $0
2. $1,000,000
3. $9,000,000
4. $8,000,000