A government issues 10,000,00 of demand bonds and fails to obtain an acceptable takeout agreement from a bank. How should the entity recognize the bond proceeds in a government fund? A debit cash 10 million credit process from sale of demand bonds 10 million B debit process from sale of demand bond 10 million credit cash 10 million C debit cash 10 million credit bonds payable 10 million D debit bonds payable 10 million credit cash 10 million

A government issues 10,000,00 of demand bonds and fails to obtain an acceptable takeout agreement from a bank. How should the entity recognize the bond proceeds in a government fund? A debit cash 10 million credit process from sale of demand bonds 10 million B debit process from sale of demand bond 10 million credit cash 10 million C debit cash 10 million credit bonds payable 10 million D debit bonds payable 10 million credit cash 10 million

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter4: Income Exclusions

Section: Chapter Questions

Problem 61P

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Local government-issued bonds to the value of RO 500,000 to finance its general operating expenditure at 10 % premium. Which one of the following journal entries records this transaction in the general fund? a. None of the options b. Bank Account Dr. 550,000, Proceeds from issue of bonds Account Cr. 500,000, Premium on issue of bonds Account Dr. 50,000 c. Bank Account Dr. 550,000, Cash Account Dr. 550,000 d. Bank Account Dr. 550,000, Proceeds from issue of bonds Account Cr. 500,000, Premium on issue of bonds Account Cr. 50,000
11. As of December 31, 2010, ‘N’ Town had OMR 5,750,000 in 3 percent serial bonds outstanding. Cash of OMR 524,500 is the debt service fund’s only asset as of December 31, 2010, and there are no liabilities. The serial bonds pay interest semi-annually on January 1 and July 1, with OMR 350,000 in bonds being retired on each interest payment date. Resources for payment of interest are transferred from the General Fund and the debt service fund levies property taxes in an amount sufficient to cover principal payment. Required: Prepare debt service fund and government-wide entries in general journal form to reflect, as necessary, the following information and transaction for FY 2011. (1) The operating budget for FY 2011 consists of estimated revenues of OMR 610,000 and estimated other financing sources equal to the amount of interest to be paid in FY 2011. Appropriations must be provided for interest payments and bond redemptions on January 1 and July 1. (2) Cash was received from the…
Lisa County issued $5,000,000 of general obligation bonds at 101 to finance a capital project. The $50,000 premium was to be used for payment of interest. The transactions involving the premium should be accounted for in thea. capital projects funds, the debt service funds, and the general long-termdebt account group.b. capital projects funds and debt service funds only.c. debt service funds and the general long-term debt account group only.d. debt service funds only.
Lincoln County retires a $50 million bond issue when the carrying value of the bonds is $48 million, but the market value of the bonds is $54 million. Lincoln County will record the retirement as a. A debit of $6 million to Loss due to early extinguishment.b. A credit of $6 million to Gain due to early extinguishment.c. No gain or loss on retirement.d. A debit to Cash for $54 million.
6. As of December 31, 2016, Rustaq New Town had OMR 9,500,000 in 4.5 percent serial bonds outstanding. Cash of OMR 509,000 is the debt service fund’s only asset as of December 31, 2016, and there are no liabilities. The serial bonds pay interest semiannually on January 1 and July 1, with OMR 500,000 in bonds being retired on each interest payment date. Resources for payment of interest are transferred from the General Fund and the debt service fund levies property taxes in an amount sufficient to cover principal payments. Required Prepare debt service fund and government-wide entries in general journal form to reflect, as necessary, the following information and transactions for FY 2017. The operating budget for FY 2016 consists of estimated revenues of OMR 1,020,000 and estimated other financing sources equal to the amount of interest to be paid in FY 2017. Appropriations must be provided for interest payments and bond redemptions on January 1 and July 1.
Raygun County had outstanding $35 million in Series 1998 general obligation bonds on June 30, 2018. The bonds were issued at an interest rate of 10 percent with interest payable on June 30 and December 31. In July 2018, interest rates declined substantially, and the county issued refunding bonds in the amount of $35 million at 5 percent. The proceeds of the refunding bonds were placed in escrow along with $2,800,000 held in the county’s debt service fund as a sinking fund for the 1998 debt. The proceeds of the refunding bonds and the sinking fund amount would be used in December 2018 (the call date) to purchase the 1998 debt at a 3 percent call premium, totaling $1,050,000, plus accrued interest of $1,750,000. The County had $250,000 of unamortized debt issue costs on the 1998 bonds, which it reported in its government-wide financial statements. This amount combined with the call premium resulted in a $3,050,000 “loss” on the refunding. (a) What journal entries should the county make…
Minor Company had cheques outstanding totaling $19,200 on its April bank reconciliation. In May, Minor Company issued cheques totaling $64,900. The May bank statement shows that $47,600 in cheques cleared the bank in May. A cheque of $300 from one of Minor Company's customers was also returned marked "NSF (Non-sufficient fund)." The amount of outstanding cheques on Minor Company's May bank reconciliation should be Select one: A. $17,300 B. $28,400 C. $66,800 D. $36,500
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General tax revenues RO 250,000, were paid to the fund to be used to pay principal and interest on the developmental bonds. Which one of the following journal entries records the transfer of fund transaction in the debt service fund? a.Bank Account Dr. 250,000, Transfer from general fund Account Cr. 250,000 b. Loan Account Dr. 250,000, Bank Account Cr. 250,000 c. Bank Account Dr. 250,000, Transfer from debt service fund Account Cr. 250,000 d. None of the options Clear my choice
A. In anticipation of issuing a long-term bond, on 12/1/20 a state issues a $200,000 60-day BAN to finance highway construction. Prepare the appropriate journal entry, if any, for the Fund Financial Statements for the following transactions; 1 (a) The issuance of the BAN on 12/1/20 assuming sufficient evidence does not exist of the state’s ability to refinance the BAN on 1/30/21. (b) Assuming the state is unable to refinance the BAN, the entry on 1/30/21 to repay the principal of $200,000. 2 (a) The issuance of the BAN on 12/1/20 assuming sufficient evidence exists of the state’s ability to refinance the BAN on 1/30/21. (b) Assuming the state is able to refinance the BAN, the entry on 1/30/21 to issue a long term bond in place of the BAN. B. Redo part A assuming the journal entries are for the Government Wide Financial Statements.
City Slicker Corporation pays $55,000 into a bond sinking fund each year for the future redemption of bonds. During the first year, the fund earns $1,475. When the bonds mature, there is a sinking fund balance of $612,000, and $600,000 is needed to redeem the bonds. Required:Prepare the following general journal entries. a. The initial sinking fund deposit. b. The first year's earnings. c. The redemption of the bonds. d. The return of excess cash to the corporation.