In preparation for a proposed bond sale, the city manager of the City of Appleton requested that you prepare a statement of legal c margin and a schedule of direct and overlapping debt for the city as of the December 31 year-end. You ascertain that the following bond issues are outstanding on that date: Convention center bonds Electric utility bonds. General obligation serial bonds Tax increment bonds Water utility bonds Transit authority bonds $ 3,900,000 3,600,000 3,800,000 3,200,000 2,600,000 2,800,000 You obtain other information that includes the following items: 1. Assessed valuation of real and taxable personal property in the city totaled $320,000,000. 2. The rate of debt limitation applicable to the City of Appleton was 4 percent of total real and taxable personal property valuation. 3. Electric utility, water utility, and transit authority bonds were all serviced by enterprise revenues. By law, such self-supporting de is not subject to debt limitation. 4. The convention center bonds and tax increment bonds are subject to debt limitation. 5. The amount of assets segregated for debt retirement at December 31 is $2,400,000. 6. The city's residents are also taxed by Clyde County for 25 percent of school district and health services debt. The school distric has $16,000,000 in outstanding bonds, while health services has $9,000,000 in debt. Finally, one-third of the $1,200,000 of regional library outstanding debt is paid by taxes assessed on Appleton residents. Required a-1. Prepare a statement of legal debt margin for the city as of December 31 year-end.
In preparation for a proposed bond sale, the city manager of the City of Appleton requested that you prepare a statement of legal c margin and a schedule of direct and overlapping debt for the city as of the December 31 year-end. You ascertain that the following bond issues are outstanding on that date: Convention center bonds Electric utility bonds. General obligation serial bonds Tax increment bonds Water utility bonds Transit authority bonds $ 3,900,000 3,600,000 3,800,000 3,200,000 2,600,000 2,800,000 You obtain other information that includes the following items: 1. Assessed valuation of real and taxable personal property in the city totaled $320,000,000. 2. The rate of debt limitation applicable to the City of Appleton was 4 percent of total real and taxable personal property valuation. 3. Electric utility, water utility, and transit authority bonds were all serviced by enterprise revenues. By law, such self-supporting de is not subject to debt limitation. 4. The convention center bonds and tax increment bonds are subject to debt limitation. 5. The amount of assets segregated for debt retirement at December 31 is $2,400,000. 6. The city's residents are also taxed by Clyde County for 25 percent of school district and health services debt. The school distric has $16,000,000 in outstanding bonds, while health services has $9,000,000 in debt. Finally, one-third of the $1,200,000 of regional library outstanding debt is paid by taxes assessed on Appleton residents. Required a-1. Prepare a statement of legal debt margin for the city as of December 31 year-end.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In preparation for a proposed bond sale, the city manager of the City of Appleton requested that you prepare a statement of legal debt
margin and a schedule of direct and overlapping debt for the city as of the December 31 year-end. You ascertain that the following
bond issues are outstanding on that date:
Convention center bonds
Electric utility bonds
General obligation serial bonds.
Tax increment bonds
Water utility bonds
Transit authority bonds
You obtain other information that includes the following items:
1. Assessed valuation of real and taxable personal property in the city totaled $320,000,000.
2. The rate of debt limitation applicable to the City of Appleton was 4 percent of total real and taxable personal property valuation.
3. Electric utility, water utility, and transit authority bonds were all serviced by enterprise revenues. By law, such self-supporting debt
is not subject to debt limitation.
4. The convention center bonds and tax increment bonds are subject to debt limitation.
5. The amount of assets segregated for debt retirement at December 31 is $2,400,000.
6. The city's residents are also taxed by Clyde County for 25 percent of school district and health services debt. The school district
has $16,000,000 in outstanding bonds, while health services has $9,000,000 in debt. Finally, one-third of the $1,200,000 of
regional library outstanding debt is paid by taxes assessed on Appleton residents.
Required
a-1. Prepare a statement of legal debt margin for the city as of December 31 year-end.
Assessed Value of Property
Rate of Debt Limitation
Amount of Debt Limitation
Outstanding Long-Term Indebtedness
Subject to Debt Limit:
Total Long-Term Debt
Less Deductions:
$ 3,900,000
3,600,000
3,800,000
3,200,000
2,600,000
2,800,000
Net Debt Subject to Limitation
Legal Debt Margin: Amount Available for Future Indebtedness
CITY OF APPLETON
Statement of Legal Debt Margin
December 31
Governmental Unit
CITY OF APPLETON
Schedule of Direct and Overlapping Debt
December 31
Subtotal, Overlapping Debt
City Direct Debt
Total Direct and Overlapping Debt
General
Obligation Bonds
a-2. Prepare a schedule of direct and overlapping debt for the city as of December 31 year-end. (Round Percentage answers to 2
decimal places.)
Estimated
Percentage
Applicable
%
%
%
%
%
%
0
%
$
0
Estimated Share
of Debt
0
0
%
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