solution- Falts City - Part a JOURNAL ENTRIES FOR 2011...

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Part a . FALTS CITY STREET IMPROVEMENT FUND JOURNAL ENTRIES FOR 2011 Debits Credits 1. CASH 100,000 OTHER FINANCING SOURCES—PROCEEDS OF BOND ANTICIPATION NOTES 100,000 2. DUE FROM FEDERAL GOVERNMENT 750,000 REVENUES 750,000 Note: the $750,000 to be received the following year is a time requirement and would not be accrued (per GASBS 33 ). 3. ENCUMBRANCES 2,700,000 RESERVE FOR ENCUMBRANCES 2,700,000 4. CONSTRUCTION EXPENDITURES 60,000 DUE TO OTHER FUNDS 60,000 5. CONSTRUCTION EXPENDITURES 69,000 CASH 69,000 6. CONSTRUCTION EXPENDITURES 18,500 VOUCHERS PAYABLE 18,500 7. RESERVE FOR ENCUMBRANCES 1,000,000 CONSTRUCTION EXPENDITURES 1,000,000 ENCUMBRANCES 1,000,000 CONTRACTS PAYABLE 1,000,000
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Debits Credits 8. CASH 3,250,000 DUE FROM FEDERAL GOVERNMENT 750,000 OTHER FINANCING SOURCES— PROCEEDS OF BONDS 2,500,000 9. OTHER FINANCING USES—REPAYMENT OF BANs 100,000 INTEREST EXPENDITURES (NOTE A) 3,000 CASH 103,000 (BANs = BOND ANTICIPATION NOTES) NOTE A: INTEREST DUE IS CALCULATED AS FOLLOWS: $100,000 x .06 x 180/360 = $3,000; PER GASBS 37 , INTEREST IS NOT CAPITALIZED FOR GENERAL CAPITAL ASSETS.
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