This year Southfork began work on a senior center to hold activities for its growing senior citizen population. It is to be financed by a $5,000,000 bond issue, a $500,000 grant, and a $500,000 General Fund transfer. The following transactions occurred during the current year:

1. The General Fund transferred $500,000 to the Senior Center Capital Projects Fund.
2. A plot of land was purchased for $400,000 in cash. (This cost had not been encumbered.)
3. Preliminary planning and engineering costs of $95,000 were vouchered. (This cost had not been encumbered.)
4. A contract was signed with Sunset Construction Company for the major part of the project on a bid of $4,950,000.
5. The $5,000,000 bonds were issued at par.
6. Temporary investments were purchased at a cost of $3,500,000.
7. A payable was recorded for a $49,500 billing from the Water and Sewer enterprise fund for the cost of extending water pipes to the new building. (This cost had not been encumbered.)
8. An invoice in the amount of $1,500,000 was received from Sunset Construction Company for progress to date on the project.
9. The amount billed by the contractor less 5 percent retainage was paid.
10. Half of the planning and engineering costs and $25,000 of the water and sewer billing were paid.
11. Grant revenue of $100,000 was received in cash for construction expenditures that were considered allowable costs in accordance with the grant agreement.
12. Closing entries were prepared as of year-end. Assume that $2,500,000 of the encumbrances outstanding will be paid from the bond proceeds and are therefore considered restricted resources. The remaining fund balance is assigned.

Required

1. Prepare journal entries to record the preceding information in the general ledger accounts for the Senior Center Capital Projects Fund.
2. Prepare a statement of revenues, expenditures, and changes in fund balances for the period.
3. Prepare a balance sheet for the Senior Center Capital Projects Fund as of year-end.

Transaction	General Journal	Debit	Credit
1. Record the $500,000 transfer from the General Fund to the Senior Center Capital Projects Fund.
1	Cash	500,000
	Other Financing SourcesInterfund Transfers In		500,000
2. Record the purchased of a plot of land for $400,000 in cash.
2		400,000
	Cash		400,000
3. Record the $95,000 preliminary planning and engineering costs incurred.
3		95,000
	Vouchers Payable		95,000
4. Record the contract signing for the major part of the project on a bid of $4,950,000.
4
5. Record the $5,000,000 issue of bonds at par.
5	Cash	5,000,000
	Other Financing SourcesProceeds of Bonds		5,000,000
6. Record the purchase of $3,500,000 temporary investments.
6	Investments	3,500,000
	Cash		3,500,000
7. Record the $49,500 payable for extending water pipes to the new building.
7		49,500
			49,500
8. Record the receipt of $1,500,000 invoice for progress to date on the project.
8		1,500,000
9. Record the payment of amount billed by the contractor less 5 percent retainage.
9	Contracts Payable	1,500,000
	Contracts Payable - Retained Percentage		75,000
	Cash		1,425,000
10. Record the payment of half of planning and engineering costs and $25,000 of the water and sewer billing.
10		47,500
		25,000
	Cash		72,500
11. Record the receipt of Grant revenue of $100,000 for construction expenditures in line with the grant agreement.
11	Cash	100,000
	Revenues		100,000
12. Record the closing entries as of year-end assuming that $2,500,000 of the encumbrances outstanding will be paid.
12	Other Financing SourcesInterfund Transfers In	500,000
	Other Financing SourcesProceeds of Bonds	5,000,000
	Revenues	100,000
	Fund BalanceRestricted		2,500,000