The Village of Hawksbill issued $4,000,000 in 5 percent general obligation, tax-supported bonds on July 1, 2019, at 102. A fiscal agent is not used. Resources for principal and interest payments are to come from the General Fund. Interest payment dates are December 31 and June 30. The first of 20 annual principal payments is to be made June 30, 2020. Hawksbill has a calendar fiscal year. 1. A capital projects fund transferred the premium (in the amount of $80,000) to the debt service fund. 2. On December 31, 2019, funds in the amount of $100,000 were received from the General Fund and the first interest payment was made. 3. The books were closed for 2019. 4. On June 30, 2020, funds in the amount of $220,000 were received from the General Fund, and the second interest payment ($100,000) was made along with the first principal payment ($200,000). 5. On December 31, 2020, funds in the amount of $95,000 were received from the General Fund and the third interest payment was made (also in the amount of $95,000). 6. The books were closed for 2020. Required: a. Prepare journal entries to record the events above in the debt service fund. b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the debt service fund for the year ended December 31, 2019. c. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the debt service fund for the year ended December 31, 2020.
The Village of Hawksbill issued $4,000,000 in 5 percent general obligation, tax-supported bonds on July 1, 2019, at 102. A fiscal agent is not used. Resources for principal and interest payments are to come from the General Fund. Interest payment dates are December 31 and June 30. The first of 20 annual principal payments is to be made June 30, 2020. Hawksbill has a calendar fiscal year. 1. A capital projects fund transferred the premium (in the amount of $80,000) to the debt service fund. 2. On December 31, 2019, funds in the amount of $100,000 were received from the General Fund and the first interest payment was made. 3. The books were closed for 2019. 4. On June 30, 2020, funds in the amount of $220,000 were received from the General Fund, and the second interest payment ($100,000) was made along with the first principal payment ($200,000). 5. On December 31, 2020, funds in the amount of $95,000 were received from the General Fund and the third interest payment was made (also in the amount of $95,000). 6. The books were closed for 2020. Required: a. Prepare journal entries to record the events above in the debt service fund. b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the debt service fund for the year ended December 31, 2019. c. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the debt service fund for the year ended December 31, 2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The Village of Hawksbill issued $4,000,000 in 5 percent general obligation, tax-supported bonds on July 1, 2019, at 102. A fiscal agent
is not used. Resources for principal and interest payments are to come from the General Fund. Interest payment dates are December
31 and June 30. The first of 20 annual principal payments is to be made June 30, 2020. Hawksbill has a calendar fiscal year.
1. A capital projects fund transferred the premium (in the amount of $80,000) to the debt service fund.
2. On December 31, 2019, funds in the amount of $100,000 were received from the General Fund and the first interest payment was
made.
3. The books were closed for 2019.
4. On June 30, 2020, funds in the amount of $220,000 were received from the General Fund, and the second interest payment
($100,000) was made along with the first principal payment ($200,000).
5. On December 31, 2020, funds in the amount of $95,000 were received from the General Fund and the third interest payment was
made (also in the amount of $95,000).
6. The books were closed for 2020.
Required:
a. Prepare journal entries to record the events above in the debt service fund.
b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the debt service fund for the year ended
December 31, 2019.
c. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the debt service fund for the year ended
December 31, 2020.
Complete this question by entering your answers in the tabs below.
Required A Required B Required C
Prepare journal entries to record the events above in the debt service fund. (If no entry is required for a transaction/event, select "No
Journal Entry Required" in the first account field.)
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Journal entry worksheet
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