Long-term Liability Transactions. 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 have 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 to retire 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 capital 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 $2,800,000 par value were issued in cash to permit partial refunding of a $3,500,000 par value issue of term bonds. The difference was settled with $700,000 that had been accumulated in prior years in a debt service fund. Assume that the term bonds had been issued several years earlier at par.

Four months prior to year-end, 6 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.

Marketable equity securities held by the debt service fund increased in value by $10,000 during the year.

Using this information

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.

2. Serial Bond Debt Service Fund Journal Entries and Financial Statements. As of December 31, 2016, Sandy Beach had $9,500,000 in 4.5 percent serial bonds outstanding. Cash of $509,000 is the debt service fund's only asset as of December 31, 2016, and there are no liabilities. The serial bonds pay interest semiannually on January 1 and July 1, with $500,000 in bonds being retired on each interest payment date. Resources for payment of interest are transferred from the General Fund, and the debt service fund levies property taxes in an amount sufficient to cover principal payments.

Prepare debt service fund and government-wide entries in general journal form to reflect, as necessary, the following information and transactions for FY 2017.

The operating budget for FY 2017 consists of estimated revenues of $1,020,000 and estimated other financing sources equal to the amount of interest to be paid in FY 2017. Appropriations must be provided for interest payments and bond redemptions on January 1 and July 1.

Cash was received from the General Fund and checks were written and mailed for the January 1 principal and interest payments.

Property taxes in the amount of $1,020,000 were levied (no estimate for uncollectible accounts has been made).

Property taxes in the amount of $1,019,000 were collected.

Cash was received from the General Fund and checks were written and mailed for the July 1 principal and interest payments.

Adjusting entries were made and uncollected taxes receivable were reclassified as delinquent. At the fund level, entries were also made to close budgetary and operating statement accounts. (Ignore closing entries in the government activities journal.)

Prepare a statement of revenues, expenditures, and changes in fund balances for the debt service fund for the year ended December 31, 2017.

Prepare a balance sheet for the debt service fund as of December 31, 2017.

3. Central Garage Internal Service Fund. The City of Ashville operates an internal service fund to provide garage space and repairs for all city-owned-and-operated vehicles. The Central Garage Fund was established by a contribution of $300,000 from the General Fund on July 1, 2017, at which time the land and building were acquired. The post-closing trial balance at June 30, 2017, was as follows:

	Debits	Credits
Cash	$110,000
Due from Other Funds	$9,000
Inventory of Supplies	$90,000
Land	$50,000
Building	$250,000
Allowance for Depreciation--Building		$20,000
Machinery and Equipment	$65,000
Allowance for Depreciation-- Machinery and Equipment		$12,000
Vouchers Payable		$31,000
Net Position--Net Investment in Capital Assets		$333,000
Nets Position--Unrestricted		$178,000
Total	$574,000	$574,000

The following information applies to the fiscal year ended June 30, 2017:

Supplies were purchased on account for $92,000; the perpetual inventory method is used.

The cost of supplies used during the year ended June 30, 2017, was $110,000. A physical count taken as of that date showed materials and supplies on hand totaled $72,000 at cost.

Salaries and wages paid to employees totaled $235,000, including related costs.

Billings totaling $30,000 were received from the enterprise fund for utility charges. The Central Garage Fund paid $27,000 of the amount owed.

Depreciation of the building was recorded in the amount of $12,000; depreciation of the machinery and equipment amounted to $8,000.

Billings to other departments for services provided to them were as follows:

General Fund	$270,000
Special Revenue Fund	127,000

Unpaid interfund receivable balances were as follows:

	6/30/16	6/30/17
General Fund	$2,500	$3,000
Special Revenue Fund	6,500	9,000

Vouchers payable at June 30, 2017, were $16,000.

For June 30, 2017, closing entries were prepared for the Central Garage Fund (ignore government-wide closing entry).

Using this information

Assume all expenses at the government-wide level are charged to the General Government function. Prepare journal entries to record all of the trans- actions for this period in the Central Garage Fund accounts and in the governmental activities accounts.

Prepare a statement of revenues, expenses, and changes in net position for the Central Garage Fund for the period ended June 30, 2017.

Prepare a statement of net position for the Central Garage Fund as of June 30, 2017.

Explain what the Central Garage Fund would need to report at the governmental activities level, and where the information would be reported.

4. Enterprise Fund Journal Entries and Financial Statements. Following is the June 30, 2017, statement of net position for the City of Bay Lake Water Utility Fund.

CITY OF BAY LAKE Water Utility Fund Statement of Fund Net Position June 30, 2013

Assets
Current assets:
Cash and investments		$1,775,019
Accounts receivable (net of $13,367 provision for uncollectible accounts)		$306,869
Accrued utility revenue		$500,000
Due from General Fund		$29,311
Interest receivable		$82,000
Total current assets		$2,693,199
Restricted assets:
Cash		$9,193
Capital assets:
Land	$1,780,945
Buildings (net of $3,420,000 in accumulated depreciation)	$5,214,407
Machinery and equipment (net of $5,129,928 in accumulated depreciation)	$8,488,395
Total capital assets (net)		$15,483,747
Total Assets		$18,186,139
Liabilities
Current liabilities:
Accounts payable	$532,047
Interest payable	$131,772
Current portion of long-term debt	$400,000
Total current liabilities		$1,063,819
Liabilities payable from restricted assets:
Customer deposits		$9,193
Long-term liabilities:
Revenue bond payable		$11,600,000
Total Liabilities		$12,673,012
Net Position
Net investment in capital assets		$3,483,747
Unrestricted		$2,029,380
		$5,513,127

For fiscal year 2017, prepare general journal entries for the Water Utility Fund using the following information.

The amount in the Accrued Utility Revenue account was reversed.

Billings to customers for water usage during fiscal year 2017 totaled $2,982,557; $193,866 of the total was billed to the General Fund.

Cash in the amount of $260,000 was received. The cash was for interest earned on investments and $82,000 in accrued interest.

Expenses accrued for the period were: management and administration, $360,408; maintenance and distribution, $689,103; and treatment plant, $695,237.

Cash receipts for customer deposits totaled $2,427.

Cash collections on customer accounts totaled $2,943,401, of which $209,531 was from the General Fund.

Cash payments for the period were as follows: Accounts Payable, $1,462,596; interest (which includes the interest payable), $395,917; bond principal, $400,000; machinery and equipment, $583,425; and return of customer deposits, $912.

A state grant amounting to $475,000 was received to help pay for new water treatment equipment.

Accounts written off as uncollectible totaled $10,013.

The utility fund transferred $800,000 in excess operating income to the General Fund.

Adjusting entries for the period were recorded as follows: depreciation on buildings was $240,053 and on machinery and equipment was $360,079; the allowance for uncollectible accounts was increased by $14,913; an accrual for unbilled customer receivables was made for $700,000; accrued interest income was $15,849; and accrued interest expense was $61,406.

The Revenue Bond Payable account was adjusted by $400,000 to record the current portion of the bond.

Closing entries and necessary adjustments were made to the net position accounts.

Prepare a statement of revenues, expenses, and changes in fund net position for the Water Utility Fund for the year ended June 30, 2017.

Prepare a statement of net position for the Water Utility Fund as of June 30, 2017.

Prepare a statement of cash flows for the Water Utility Fund as of June 30, 2017.