EX. 8-3

Government debts may be reported differently in governmental and government-wide statements.

The Alpine school district engaged in the following transactions in its fiscal year ending August 31, 2018. By law, the district is required to establish a capital projects fund to account for school construction projects and a debt service fund to account for resources legally restricted to the payment of long-term principal and related interest.

On March 1, it issued $40 million in general obligation bonds to finance the construction of a new junior high school. The bonds were to mature in 20 years (40 periods) and had a coupon rate of 4 percent per year (2 percent per semiannual period). They were sold for $38,924,728 (a discount of $1,075,272), a price that reflected an a~nual yield of 4.2 percent (2.1 percent per period).

On August 31 the district made its first interest payment of $800,000.

During the year the builder with whom the district contracted to construct the building completed approximately 10 percent of the building and billed the district for $4 million.

On August 31, the district issued $10 million in bond anticipation notes to finance improvements to its athletic facilities. By the time the district issued its fiscal year-end 2018 financial statements in December 2018, it still had not refinanced these notes and had not yet started construction on the facilities.

In June the district issued $2 million in tax anticipation notes. It repaid these notes in September. Interest applicable to the notes for the fiscal year ending August 31,2018, was $25,000, all of which was paid in September when the notes matured.

In August, the district settled a lawsuit with a group of former teachers. Per a structured settlement, the district agreed to make several payments totaling $1,600,000 to the teachers. The district has a policy of recording long-term obligations at present value whenever required or permitted by GAAP. It esti- mates the present value of this settlement to be $1,350,000.

What amount relating to these transactions should the district report in its August 31, 2018, financial statements as:

Interest expenditure in its debt service fund statement of revenues and expenditures?

Interest expense in its government-wide statement of activities?

Long-term debt in the capital projects fund balance sheet?

Current debt in the capital projects fund balance sheet?

Long-term debt in the debt service fund balance sheet?

Bonds payable (net of bond discount) in the government-wide statement of net position?

Other noncurrent debt in the government-wide statement of net position?

Invested in capital assets, in the government-wide statement of net position?

Current liabilities in the general-fund balance sheet?

Select each response from one of the amounts that follow. An amount may be selected once, more than

once, or not at all.

$(34,942,147)

$0

$25,000

$800,000

$817,419

$842,419

$1,350,000

$1,600,000

$2,000,000

$2,025,000

$10,000,000 I. $12,000,000

$12,025,000

$38,924,728

$38,942,147