Question
On January 1, 2016, the City of Pittsburgh is planning on issuing $1,000,000 in 10 year term bonds. The bonds will be issued at a
On January 1, 2016, the City of Pittsburgh is planning on issuing $1,000,000 in 10 year term bonds. The bonds will be issued at a 1% premium and the coupon rate of 4%. Assuming these facts are known on January 1 and the bond will pay interest on July 1 and January 1 of every year, what budgetary entry should the debt service fund make on January 1, 2016 to account for these bonds?
Group of answer choices
Debit Estimated OFS- Premium on Bonds $10,000
Debit Budgetary Fund Balance $30,000
Credit Appropriations $40,000
Debit Estimated OFS- Premium on Bonds $10,000
Debit Budgetary Fund Balance $10,000
Credit Appropriations $20,000
Debit Budgetary Fund Balance $40,000
Credit Appropriations $40,000
Debit Budgetary Fund Balance $20,000
Credit Appropriations $20,000
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