York established a debt service fund to account for the proceeds of the bonds issued to finance the walkway (see exercise 18-6). The 9 percent, \(\$ 200,000\) bond issue was sold at 102.5 on January 1, 20X1. It is a 10 -year serial bond issue. The resources to pay the interest and annual principal will be from a property tax levy.

\section*{Additional Information}

1. The operating budget for \(20 \mathrm{X} 1\) included estimated revenue of \(\$ 38,000\) and appropriations of \(\$ 20,000\) for principal and \(\$ 18,000\) for interest and an estimated transfer in of \(\$ 5,000\) from the capital projects fund.

2. The property tax levy was for \(\$ 40,000\), and an allowance for uncollectibles of \(\$ 4,000\) was established. Collections totaled \(\$ 36,000\). The remaining taxes were reclassified as delinquent, and the allowance was reduced to \(\$ 1,000\). The bond premium was received from the capital projects funds.

3. The current portion of the serial bonds and the interest due this year were recorded and paid. Other expenses charged to the debt service fund totaled \(\$ 1,800\), and \(\$ 1,500\) was paid.

4. A transfer in of \(\$ 10,600\) was received from the capital project fund 5. The nominal accounts were closed.

\section*{Required}

a. Prepare entries for the debt service fund for 20X1.

\(b\). Prepare a statement of revenues, expenditures, and changes in fund balance for \(20 \mathrm{X} 1\) for the debt service fund.