Quetion 1 Not complete Marked out of 2.86 Journal entries, financial statements, and closing entries for a Capital Projects Fund The following transactions occurred during the fiscal year july 1, 2021 to June 30, 2022: 1. The City of Spainville approved the construction of a city hall complex for a total cost of $120,000,000. A few days later, a contract with a 5 percent retainage clause was signed with Paltrow Construction for the complex. The bulldings will be financed by a federal expenditure-driven grant of $25,000,000 and a general obligation bond issue of $100,000,000. During the current year, investment revenue of $4,000,000is budgeted. (Assume the budget is recorded in the accounts and encumbrance accounting is used.) 2. The bonds were issued for $90,000,000 (the face amount of the bonds was $100,000,000 ). The difference between the actual cost of the project and the bond and grant proceeds was expected to be generated by investing the excess cash during the construction period. 3. The city collected the grant from the government. 4. The city invested $90,000,000. 5. The contract signed with Paitrow stipulated that the contract price included architect fees. The architects were paid their fee of $45,000 by 5p ainville. Retainage does not apply to the architect fees. (Assume a Vouchers payable account is used.) 6. Paitrow submitted a progress billing for $25,000,000. The billing, less 5 percent retainage, was approved. Assume that the city will use resources from the federal grant to make this payment. 7. Investments that cost $5,000,000 were redeemed for a total of $5,020,000. Note: The $20,000 increase represents interest income. 8 . Interest income totaling $3,500,000 was received in cash. 9. The contractor was paid the amount billed in transaction 6 , less a 5 percent retainage. 10. The contractor submitted another progress billing for $25,000,000. The billing. less retainage, was approved. 11. Investments totaling $14,600,000 were redeemed, together with additional interest income of $1,400,000. 12. The contractor was pald the amount billed In transaction 10, less a 5 percent retainage. 13. Interest income of $250,000 was accrued. 14 . Bond interest totaling $10,000,000 was paid. Use the preceding information to do the following: a. Prepare the journal entries necessary to record these transactions in a Capital Projects Fund for the City of Spainville. b. Prepare a trial balance for the fund as of June 30,2022 , before closing. c. Prepare any necessary closing entries. The general obligation bond proceeds and federal grant revenues are restricted by the debt covenant and the federal government for construction of the city hall complex. Neither the debt covenant nor the federal grant makes any mention of how investment earnings on their money should be used. Based on authority granted it by the city council, the City of Spainville's management has decided to use the investment earnings for construction of the city hall complex or, if not needed for construction, for debt service. d. Prepare a statement of revenues, expenditures, and changes in fund balance for the year ended June 30, 2022, and a balance sheet as of June 30,2022 . e. Prepare the journal entry or entries necessary to record the remainder of the budget and to reestablish the budgetary accounts for encumbrances as of July 1, 2022. Assume investment revenues of $2,000,000 are expected in the 2023 fiscal year. Note: If no journal entry is necessary, select the no entry required-debit and no entry required-credit for the account names and record zero for the ebit and credit amounts