The following events occurred in the highway capital projects fund for the State of Montana during the past year:

1. A highway improvement project was authorized, at an expected cost of $35,000,000. This project is expected to last two years. Budgetary accounts are recorded directly on the books of the capital projects fund. Bonds of $25,000,000 were authorized to help finance the project, and the remaining funds were budgeted to come from general fund resources.

2. Bonds of $25,000,000 were issued in the first year at par, and the general fund transferred $10,000,000 to the capital projects fund.

3. Winning bids were accepted from contractors in the amount of $33,800,000.

4. First year expenditures on the project were $20,000,000. $19,900,000 in cash was paid.

Required: Prepare entries to record the year's events, including budget, adjusting and closing entries.