City of Smithville, Chapter 6, 17th etition, journal entries: Could I get help with this initial journal entry, please?

Accounts available:

Cash,

Taxes Recievalbe,

Allowance for Uncollectible current taxes,

Taxes Recievable - Delinquent

Allowance for Uncollectible Delinquent Taxes,

Interest and Penalties Recievable on Taxes,

Allowance for Uncollectible Interest & Penalities,

Investments,

Interfund Loans Payable - Current,

Fund Balance - Restricted,

Budgetary Fund Balance,

Estimated Revenue - Taxes,

Estimated Revenue - Interest and Penalites on Taxes,

Estiamted Revenue - Investment Income,

Estimated Revenue - Accrued Interest on Bonds Sold,

Estiamted Revenue - Change in Fair Value of Investments

Estiamted Other Financing Sources - Premium on BOnds

Estiamted OTher Financing Sources - Interfund Transfers in

Revenue- Taxes,

Revenue - Interest & Penalites on Taxes,

Revenue - Investment Income,

Revenue - Accrued Interest on BOnds Sold,

Revenue - Change in Fair Value of Investments,

Other FInancing Sources - Premium on Bonds,

Other Financing Sources - Interfund Transfers In

Appropriations,

Expenditures - BOnd Interest,

Expenditures - BOnd Prinicipal

Chapter 6 Transactions Affecting General Long-term Liabilities and

Debt Service

The City of Smithville created a Street Improvement Bond Debt Service Fund to be used to retire the bonds issued for the purposes described in Chapter 5 of this cumulative problem, and to pay the interest on the bonds. The $2,000,000 face value of bonds issued during 2017 are dated January 1, 2017, but were not issued until May 6, 2017. Because bondholders will receive six months of interest on July 1, 2017 in the total amount of $40,000, they were required to pay $28,000 on the date of issue to pay the city for unearned interest from January 1 to May 6. The bonds bear interest of 4 percent per annum. The first interest payment of $40,000 is due July 1, 2017. Subsequent semiannual interest payments will be made January 1 and July 1 of each following year until the maturity of the bond. Bonds in the amount of $500,000 are to mature five years after the date of the bonds (January 1, 2022), and $100,000 is to mature January 1 of each year thereafter until all the bonds have been retired. Thus, these bonds are deferred serial bonds as discussed in Chapter 6 of the textbook. Make entries as instructed in the following paragraphs. As the bond issue was not made until May 2017, the city will not levy debt service property taxes until next year.

Bond covenants related to this bond issue require the city to levy property taxes sufficient to make principal and interest payments until the bonds have been retired. The city council has approved a resolution to enable the property tax levy, beginning in fiscal year 2018.