Exercise $5-26($Static$)$ Capital Projects Transactions $[$LO $5-2,5-4,5-5]$

This year Southfork began work on a senior center to hold activities for its growing senior citizen population. It is to be financed by a

$$5,000,000$ bond issue, a $$500,000$ grant, and a $$500,000$ General Fund transfer. The following transactions occurred during the

current year:

The General Fund transferred $$500,000$ to the Senior Center Capital Projects Fund.

A plot of land was purchased for $$400,000$ in cash. $($This cost had not been encumbered.$)$

Preliminary planning and engineering costs of $$95,000$ were vouchered. $($This cost had not been encumbered.$)$

A contract was signed with Sunset Construction Company for the major part of the project on a bid of $$4,950,000.$

The $$5,000,000$ bonds were issued at par.

Temporary investments were purchased at a cost of $$3,500,000.$

A payable was recorded for a $$49,500$ billing from the Water and Sewer enterprise fund for the cost of extending water pipes to the

new building. $($This cost had not been encumbered.$)$

An invoice in the amount of $$1,500,000$ was received from Sunset Construction Company for progress to date on the project.

The amount billed by the contractor less $5$ percent retainage was paid.

Half of the planning and engineering costs and $$25,000$ of the water and sewer billing were paid.

Grant revenue of $$100,000$ was received in cash for construction expenditures that were considered allowable costs in accordance

with the grant agreement.

Closing entries were prepared as of year$-$end. Assume that $$2,500,000$ of the encumbrances outstanding will be paid from the

bond proceeds and are therefore considered restricted resources. The remaining fund balance is assigned.

Required

a$.$ Prepare journal entries to record the preceding information in the general ledger accounts for the Senior Center Capital Projects

Fund.

b$.$ Prepare a statement of revenues, expenditures, and changes in fund balances for the period.

c$.$ Prepare a balance sheet for the Senior Center Capital Projects Fund asExercise $5-26($Static$)$ Capital Projects Transactions $[$LO $5-2,5-4,5-5]$

This year Southfork began work on a senior center to hold activities for its growing senior citizen population. It is to be financed by a

$$5,000,000$ bond issue, a $$500,000$ grant, and a $$500,000$ General Fund transfer. The following transactions occurred during the

current year:

The General Fund transferred $$500,000$ to the Senior Center Capital Projects Fund.

A plot of land was purchased for $$400,000$ in cash. $($This cost had not been encumbered.$)$

Preliminary planning and engineering costs of $$95,000$ were vouchered. $($This cost had not been encumbered.$)$

A contract was signed with Sunset Construction Company for the major part of the project on a bid of $$4,950,000.$

The $$5,000,000$ bonds were issued at par.

Temporary investments were purchased at a cost of $$3,500,000.$

A payable was recorded for a $$49,500$ billing from the Water and Sewer enterprise fund for the cost of extending water pipes to the

new building. $($This cost had not been encumbered.$)$

An invoice in the amount of $$1,500,000$ was received from Sunset Construction Company for progress to date on the project.

The amount billed by the contractor less $5$ percent retainage was paid.

Half of the planning and engineering costs and $$25,000$ of the water and sewer billing were paid.

Grant revenue of $$100,000$ was received in cash for construction expenditures that were considered allowable costs in accordance

with the grant agreement.

Closing entries were prepared as of year$-$end. Assume that $$2,500,000$ of the encumbrances outstanding will be paid from the

bond proceeds and are therefore considered restricted resources. The remaining fund balance is assigned.

Required

a$.$ Prepare journal entries to record the preceding information in the general ledger accounts for the Senior Center Capital Projects

Fund.

b$.$ Prepare a statement of revenues, expenditures, and changes in fund balances for the period.

c$.$ Prepare a balance sheet for the Senior Center Capital Projects Fund as of year$-$end.

Prepare a statement of revenues, expenditures, and changes in fund balances for the period.