Please complete number 2-5
Chapter 6 Transactions Affecting General Leng-Term Liabilities and Debt Serviee The City of Bingham utilizes a single debt service fund to account for the service of all issues of tax-supported and rpecial assessment lang-term debt. As of December 31,2022 , ene issue of tax-mupported senal bonds was outstanding See the beginning trial balance for governmental activities - the outhtanding balance is classified as the current portion of long-ierm debt The post-clesing trial balance of the debt service fund as of December 31,2022 , is shown below: a. Record the following accouns and balances in the debt service fund general joumal, aciecting 2022 from the [Year] menu and using 6 -a for the [Description]. When completed select [Post Entries] to. post the entries in the general ledgers. [Note: These opening balances were previously recorded in the governmental activities general fournal in Chapter 2 of this project.] City of Binghum Debt Service Fund Post-Closing Trial Balance As of Decetmer 31,2022 Additional Informanion: On January 1, 2023, the City of Bingham sold a 20-year issuc of tax-supported serial bonds to finance the construction and equipping of an annex to City Hall. As described in Chapter 5 of this cumulative problem, the total amount of bonds issued on that date was $4,000,000, sold at 101 . The issue bears interest at the annual rate of 2 percent, payable on January 1 and July 1 of each year, serial bonds in the amount of $200,000 will mature on January 1, 2024, and January 1 of each following year until maturity. The premium on these bonds will be amortized on a straight-line basis every six months. (Note: You will not use the effective interest method to calculate interest expense. Interest expense will be the difference betveen the cash payment for interest and the amortization on the bond premium.) Required: b. Prepare general journal entries, as necessary to record the following transactions in the debt service fund general journal and, if applicable, in the governmental activities general journal. Use account titles listed in the drop down [Account] menu for each of these accounting entities. Be sure to select year "2023" from the drop-down [Year] menu and the appropriate paragraph number shown in bold-face font below in the [Description] box. 1. [Para. 6-b-1] Record the adoption of the legal budget for the fiscal year ended December 31,2023 . Estimated Other Financmg sources: 40,000 Bond Premium The appropriation for bond interest provides for the $6,000 interest payment related to the bonds maruring on January 1,2023 and the $40,000 interest payment due on July 1,2023(.01$4,000,000) for the bonds issued on January 1,2023 . 2. [Para. 6-b-2] Taxes were levied by the debt service fund in the amount of $1,938,000,0 this amount, $38,000 was expected to be uncollectible. (NOTE: Total taxes billed was $1,938,000.) 3. [Para. 6-b-3] Cash in the amount of the $40,000 premium on the bonds sold on January 1, 2023 was received and recorded in the debt service fund. NOTE: The credits for this entry in the governmental activities general joumal should have been made as part of the requirements for Chapter 5. 4. [Para. 6-b-4] Temporary investments were purchased in the amount of $100,000. 5. [Para. 6-b-5] Checks were written and mailed to bondholders for bonds maturing on January 1,2023 , and to pay all bond interest due that day ($300,000 current portion of long term debt, plus an interest payment of $6,000. In the governmental activities general journal, debit Accrued Interest Payable for the interest payment as this amount was expensed on December 31,2022 , the end of the preceding fiscal year. 6. [Para. 6b6] Current taxes receivable were collected in the amount of $1,841,100. Also, delinquent taxes receivable were collected in the amount of $5,600, along with Interest and Penalties Receivable on Taxes of $4,550. 7. [ Para. 6-b-7] Temporary investments were purchased in the amount of $200,000. 8. [Para, 6-b-8] Pay the $40,000 interest payment due on July 1, 2023. At the government-wide level, S1,000 was debited for amortization of the premium on bonds sold for the 2% serial bonds. 9. Para, 6-b-9| Current taxes receivable of $58,140 were collected. 10. [Para. 6-b-10] The uncollected balance of current taxes receivable and the related estimated uncollectible account were reclassified as delinquent. Interest and penalties of $3,000 were accnued, of which $150 was estimated to be uncollectible. 11. [Para. 6-b-11] Interest on temporary investments was received in cash in the amount of $9,500. 12. [Para. 6-b-12] Cash to close the City Hall Annex Construction Fund was received in the amount of $242,000. (See Chapter 5, Para. 5-a-15). 13. [Para. 6-b-13] At December 31, 2023, accrued interest expense on the outstanding bond issue was recorded in the governmental activities general journal. Amortization of the premium on the 2% bonds sold was also recorded in the amount of $1,000. The total interest payable to be accrued is $40,000. Verify the accuracy of journal entries, including dates and paragraph numbers, and, if you have not already done so, post all entries to the general ledger of both the debt service fund and governmental activities by clicking on [Post Entries]. Make the entries needed to close the budgetary and operating statement accounts at the end of fiscal year 2023. Make this entry only in the journal for the debt service fund. Be sure for each account being closed that the check mark for [Closing Entry] is on and that "Closing Entry" appears in the [Description] box. [Note: Closing entries for governmental activities at the governmentwide level will be made in Chapter 9 of this cumulative problem.] Review your trial balance for reasonableness. You should have no tax receivables-current, and there shoul be no allowance that isn't linked to a receivable. You should also have no negative balances. There shoul be NO temporary accounts on the post-closing trial balance
