The citizens of Spencer County approved the issuance of $2,000,000 in 6 percent general obligation bonds to finance the construction of a courthouse annex. A capital projects fund was established for that purpose. The preclosing trial balance of the courthouse annex capital project fund follows:

Trial BalanceDecember 31, 2015	Debits	Credits
Cash	$900,000
Contract payable		$ 550,000
Due from state government	200,000
Encumbrances	85,000
Expenditurescapital	1,850,000
Intergovernmental grant		400,000
OFS: premium on bonds		45,000
OFS: proceeds sale of bonds		2,000,000
Budgetary fund balanceReserve for encumbrances		85,000
Transfer out	45,000
	$3,080,000	$3,080,000

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a.Prepare any closing entries necessary at year-end.

b.Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the courthouse annex capital project fund.

c.Prepare a balance sheet for the Courthouse Annex Capital Project Fund, assuming all unexpended resources are restricted to construction of the courthouse annex.

Do not forget to show all necessary steps and explain how you attained the outcome.