$29.$ Award: $0\mathrm{.}45$ points

Residents from the Town of Mountain View authorized a $$3,750,000$ renovation to their historic town hall on November $15,2022.$ Financing for the project consists

of $$1,600,000$ from a $4$ percent serial bond issue, $$1,050,000$ from a state grant, and $$1,100,000$ from the General Fund. Debt service for the serial bonds will be

provided by a one$-$quarter$-$cent city sales tax imposed on every dollar of sales in the city. You may ignore entries in the General Fund. The town has a calendar

year$-$end.

Required

Prepare journal entries to record the related transactions in the town$$s capital projects fund, debt service fund, and governmental activities at the government$-$wide

level. $($Do not round intermediate calculations. If no entry is required for a transaction$/$event$,$ select $"$No Journal Entry Required" in the first account

field.$)$

Transaction Fund$/$Governmental Activities General Journal Debit Credit

a$.$ Record the $2023$ budget for the Serial Debt Service Fund. Sales taxes of $$210,000$ are expected to be collected in $2023$; the only appropriation is expected

to be six months of interest on the serial bond.

a Debt Service fund Estimated Revenues $210,000$

Appropriations $32,000$

Budgetary Fund Balance $178,000$

Capital Projects Fund No Journal Entry Required

Governmental Activities No Journal Entry Required

b$.$ The town transfers $$1,100,000$ from the General Fund to a newly established capital projects fund.

b Debt Service fund No Journal Entry Required

Capital Projects Fund Cash $1,100,000$

Other Financing Sources$$Interfund Transfers In $1,100,000$

Governmental Activities No Journal Entry Required

c$.$ Planning and architect$$s fees for the town hall renovation are paid in the amount of $$200,000.$

c Debt Service fund No Journal Entry Required

Capital Projects Fund Construction Expenditures $200,000$

Cash $200,000$

Governmental Activities Construction Work in Progress $200,000$

Cash $200,000$

d$.$ The town hall renovation construction contract is awarded to a local contractor, Central Paving and Construction, for $$3,560,000.$

d Debt Service fund No Journal Entry Required

Capital Projects Fund Encumbrances $3,560,000$

Encumbrances Outstanding $3,560,000$

Governmental Activities No Journal Entry Required

e$.$ On April $1,2023,$ the town issues serial bonds with a face value totaling $$1,600,000$ and having maturities ranging from one to $20$ years at $104.$ The bonds

bear interest of $4$ percent per annum, payable semiannually on April $1$ and October $1.$

e$(1)$ Debt Service fund Record the issue of bonds in the Debt Service Fund

Cash $64,000$

$64,000$

e$(2)$ Premiums on bonds issued must be deposited directly in the debt service fund and are restricted for debt

service. $($Remember to amend the debt service fund budget because this premium was not anticipated.$)$

Estimated Other Financing Sources$$Premium on Bonds $64,000$

Budgetary Fund Balance $64,000$

e$(3)$ Capital Projects Fund Premiums are amortized using the straight$-$line method over $40$ interest periods. Record the issue of

bonds.

Cash $1,600,000$

Other Financing Sources$$Proceeds of Bonds $1,600,000$

e$(4)$ Governmental Activities Record the issue of bonds.

Cash $1,664,000$

Premium on Bonds Payable $64,000$

Bonds Payable $1,600,000$

f$.$ The capital projects fund paid the city$$s Utility Fund $$80,000$ for wiring associated with the renovation. No encumbrance had been recorded for this service.

f Debt Service fund No Journal Entry Required

Capital Projects Fund Construction Expenditures $80,000$

Cash $80,000$

Governmental Activities Construction Work in Progress $80,000$

Cash $80,000$

g$.$ On October $1,2023,$ the city mailed checks to bondholders for semiannual interest on the bonds.

g Debt Service fund Expenditures$$Interest $32,000$

Cash $32,000$

Capital Projects Fund No Journal Entry Required

Governmental Activities Premium on Bonds Payable $1,600$

Expenses$$Interest on Long$-$term debt $30,400$

Cash $32,000$

h$.$ Sales taxes earmarked for debt service of $$210,000$ were collected.

h Debt Service fund Cash $210,000$

Revenues $210,000$

Capital Projects Fund No Journal Entry Required

Governmental Activities Cash $210,000$

General Revenues$$Taxes $210,000$

i$.$ Central Paving and Construction submitted a progress billing to the town for $$1,600,000.$ The city$$s public works inspector agrees that all milestones have

been met for this portion of the work.

i Debt Service fund No Journal Entry Required

Record the reversal of encumbrances for the progress to date on the project and also the construction

expenditure for the invoice received.

Capital Projects Fund Encumbrances Outstanding $1,600,000$

Construction Expenditures $1,600,000$

Encumbrances $1,600,000$

Contracts Payable $1,600,000$

Governmental Activities Construction Work in Progress $1,600,000$

Contracts Payable $1,600,000$

j$.$ The town paid Central Paving and Construction the amount it had billed, except for $4$ percent that was withheld as a retained percentage per terms of the

contract.

j Debt Service fund No Journal Entry Required

Capital Pro