Following are a number of unrelated transactions for the Village of Centerville, some of which affect governmental activities at the government-wide level. None of the transactions has been recorded yet.

The General Fund collected and transferred $750,000 in tax collections to the debt service fund; $600,000 of this amount was used for a principal payment on outstanding serial bonds and the remainder was used to make the interest payment on the outstanding serial bonds.

A $5,000,000 issue of serial bonds to finance a capital project was sold at 102 plus accrued interest in the amount of $50,000. The accrued interest and the premium were recorded in the debt service fund. Accrued interest on bonds sold must be used for interest payments; the premium is designated by state law for eventual payment of bond principal.

The debt service fund made a $110,000 lease payment, of which $15,809 was interest. Funds used to make the lease payment came from a capital grant received by the special revenue fund.

Tax-supported serial bonds with a $3,500,000 par value were issued in cash to permit refunding of a $3,500,000 par value issue of term bonds. Assume that the term bonds had been issued several years earlier at par.

page 265Four months prior to year-end, 3 percent special assessment bonds totaling $500,000 were issued to fund a streetlight improvement project in a local subdivision. The bonds are secondarily backed by the village. The first $25,000 installment will be due from property owners six months after the initial bond issuance, but no debt payments are due in the first year.

A $5,000,000 issue of construction bonds was sold at par by the capital projects fund. Debt issuance costs included administrative fees of $45,000 and prepaid insurance costs of $5,000.

Due to an unexpected change in interest rates, a village issued a $2,500,000 bond at 98 percent of par value. The bond was issued to fund construction of a bike path, including restrooms and picnic shelters. It is expected that the shortage of cash will be covered by a future transfer from another fund.

A town secures a note payable in the amount of $150,000 to pay initial expenses for construction of a new police station. Town administrators plan to repay this note within three months with tax revenues.

A county secures a bond anticipation note in the amount of $500,000 to pay initial expenses for construction of a convention center. The board of county commissioners recommended that the finance department refinance the bond anticipation note by issuing a construction bond when construction activity begins.

Required

Prepare in general journal form the necessary entries in the governmental activities and appropriate fund journals for each transaction. Explanations may be omitted. For each entry you prepare, name the fund in which the entry should be made.