A. Analyze the effects of the following transactions on the accounting equations of the various funds and nonfund accounts of a state or local government. Include any adjustments required at the government's December 31 year-end. Unless otherwise indicated, the items are for unrelated entities. B. Indicate how each transaction would be reported in the operating statement for each fund affected. Indicate the statement and the fund, as well as the reporting classification. Example: The city paid utilities totaling $60,000 for the current month from its General Fund. Example Solution: General Fund Financial Assets -60,000 Related Liabilities Fund Balance -60,000 Statement of revenues, expenditures, and changes in fund balance Expenditures of $60,000 1. A government issued $10 million of bonds to finance construction of a plant expansion for its Water and Sewer Enterprise Fund's water treatment plant. The 20-year bonds bear interes of 10%, payable semiannually each March 31 and September 30. The bonds were issued at par on April 1, 20X1. The September payment was made as scheduled. 2. A government issued $5 million of general obligation bonds to finance construction of an addition to its courthouse. The 10-year bonds pay interest of 10%, payable semiannually each March 31 and September 30. The bonds were issued at par on April 1, 20X1. The September payment was made as scheduled from the appropriate fund. 3. A government paid general government bond principal ($500,000) and interest ($1,000,000) when it was due. Resources for the payment were available in the appropriate fund. 4. A government was billed $2,000,000 by a contractor for work performed on a major genera government capital project during the year. The government paid the contractor all but 10% of the amount billed. The project is not complete at year end. 5. A government completed a major general government capital project during the year. The $500,000 of net assets remaining in the construction fund after payment of all project liabilities was paid over to the fund that is to be used to pay the principal and interest on the construction bonds.