On January 1, the township defeased in substance $400k of bonds that had been issued years earlier to construct the bridge. The bonds had been issued at par. To effect the transaction the township issued $405k of new bonds, at par, and placed the proceeds in a trust. The old bonds have a coupon rate of 5 percent, the new bonds have a coupon rate of 4 percent.

What amount should Luling report in its December 31, 2011 financial statements as: Bond proceeds in its capital project fund.