Principles of Financial Accounting.
24th Edition
ISBN: 9781260158601
Author: Wild
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 14, Problem 1BTN
1.
To determine
Identify the actions are taken by politicians and bankers are ethical in this situation.
2.
To determine
Identify the terms of risk, how do the tax exempt securities used to pay for the building and compare to a conventional municipal bond issued by TS.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
The voters of Salinas City authorized the construction of a new north-south expressway for a total cost of no more that $90 million. The voters also approved the issuance of $60 million of 5 percent general obligation bonds. The balance of the necessary funds will come from the following sources: $20 million from a federal grant and $10 million from a state grant. The city controls expenditures in capital project funds through project management. The city does not formally incorporate budgetary entries in the capital projects fund but it does use encumbrance accounting for control purposes.
Assume that the city maintains its books and records in a manner that facilitates the preparation of the fund financial statements. Prepare journal entries in the capital projects fund, for the following transactions. The city
(a) Issues $60 million of 5 percent general obligation bonds at 101.
(b) Transfers the premium to the appropriate fund.
(c) Incurs bid-related expenditures of $1,000.
(d)…
A city issues RO 20 million of general obligation bonds to improve the streets and roads. The city management set aside RO 1.5 million to meet its payment of principal and interest. The amount of liability that the city should report in its debt service fund is
a.
RO 21.5 million
b.
RO 20 million
c.
None of the options
d.
RO 18.5 million
As the tax assessor for Indian Creek County, you have been informed that due to budgetary demands attacks increase will be necessary next year. The total market value of the property in the county is $800,000,000. Currently the assessment rate is 35% and the tax rate is 30 mills. The county commission increases the assessment rate to 55% in the tax rate to 35 mills.
A-how much property tax and dollars was collected under the old rates?
B-how much more tax in dollars revenue will be collected under the new rates? 
Chapter 14 Solutions
Principles of Financial Accounting.
Ch. 14 - A bond traded at 97 means that a. The bond pays...Ch. 14 - Prob. 2MCQCh. 14 - Prob. 3MCQCh. 14 - Prob. 4MCQCh. 14 - Prob. 5MCQCh. 14 - Prob. 1DQCh. 14 - Prob. 2DQCh. 14 - Prob. 3DQCh. 14 - Prob. 4DQCh. 14 - Prob. 5DQ
Ch. 14 - Prob. 6DQCh. 14 - Prob. 7DQCh. 14 - Prob. 8DQCh. 14 - Prob. 9DQCh. 14 - Prob. 10DQCh. 14 - Prob. 11DQCh. 14 - Prob. 12DQCh. 14 - Prob. 13DQCh. 14 - Prob. 14DQCh. 14 - Prob. 15DQCh. 14 - Prob. 16DQCh. 14 - Prob. 17DQCh. 14 - Prob. 18DQCh. 14 - Prob. 19DQCh. 14 - Bond financing Identify the following as either an...Ch. 14 - Prob. 2QSCh. 14 - Prob. 3QSCh. 14 - Prob. 4QSCh. 14 - Prob. 5QSCh. 14 - Prob. 6QSCh. 14 - Prob. 7QSCh. 14 - Prob. 8QSCh. 14 - Prob. 9QSCh. 14 - Prob. 10QSCh. 14 - Prob. 11QSCh. 14 - Prob. 12QSCh. 14 - Bond features and terminology Enter the letter of...Ch. 14 - Prob. 14QSCh. 14 - Prob. 15QSCh. 14 - Prob. 16QSCh. 14 - Prob. 17QSCh. 14 - Prob. 18QSCh. 14 - Prob. 19QSCh. 14 - Prob. 20QSCh. 14 - Prob. 1ECh. 14 - Prob. 2ECh. 14 - Prob. 3ECh. 14 - Prob. 4ECh. 14 - Prob. 5ECh. 14 - Prob. 6ECh. 14 - Duval Co. issues four-year bonds with a 100,000...Ch. 14 - Prob. 8ECh. 14 - Prob. 9ECh. 14 - Prob. 10ECh. 14 - Prob. 11ECh. 14 - Prob. 12ECh. 14 - Prob. 13ECh. 14 - Prob. 14ECh. 14 - Prob. 15ECh. 14 - Prob. 16ECh. 14 - Prob. 17ECh. 14 - Prob. 18ECh. 14 - Prob. 19ECh. 14 - In each of the following separate cases, indicate...Ch. 14 - Prob. 21ECh. 14 - Prob. 22ECh. 14 - Prob. 1APCh. 14 - Prob. 2APCh. 14 - Prob. 3APCh. 14 - Prob. 4APCh. 14 - Prob. 5APCh. 14 - Prob. 6APCh. 14 - Prob. 7APCh. 14 - Prob. 8APCh. 14 - Prob. 9APCh. 14 - Prob. 10APCh. 14 - Prob. 11APCh. 14 - Refer to the lease details in Problem 14-11A....Ch. 14 - Prob. 1BPCh. 14 - Prob. 2BPCh. 14 - Prob. 3BPCh. 14 - Prob. 4BPCh. 14 - Prob. 5BPCh. 14 - Prob. 6BPCh. 14 - Prob. 7BPCh. 14 - Prob. 8BPCh. 14 - Prob. 9BPCh. 14 - Prob. 10BPCh. 14 - Prob. 11BPCh. 14 - Prob. 12BPCh. 14 - Prob. 14SPCh. 14 - Prob. 1AACh. 14 - Prob. 2AACh. 14 - Prob. 3AACh. 14 - Prob. 1BTNCh. 14 - Prob. 2BTNCh. 14 - Prob. 3BTNCh. 14 - Prob. 5BTN
Knowledge Booster
Similar questions
- The City of Frost has a 20-year debt outstanding. On the last day of the current year, this debt has an outstanding balance of $4.8 million and five years remaining until it is due. On that date, the debt is paid off early for $5 million. A new debt is issued (with a lower interest rate) for $5.4 million. How is the $200,000 between the amount paid and the outstanding balance of $4.8 million recognized on government-wide financial statements? As an expense. As a reduction in liabilities. As a deferred outflow of resources on the statement of net position. As an asset on the statement of net position.arrow_forwardThe City of Frost has a 20-year debt outstanding. On the last day of the current year, this debt has an outstanding balance of $4.8 million and five years remaining until it is due. On that date, the debt is paid off early for $5 million. A new debt is issued (with a lower interest rate) for $5.4 million. How is the $200,000 between the amount paid and the outstanding balance of $4.8 million recognized on government-wide financial statements? Choose the correct.a. As an expense.b. As a reduction in liabilities.c. As a deferred outflow of resources on the statement of net position.d. As an asset on the statement of net position.arrow_forward4.) Armstrong County established a County Office Building Construction Fund to account for a project expected to take less than one year to complete. The County's fiscal year ends on June 30. On July 1, 2023, bonds were sold at par in the amount of $7,500,000 for the project. On July 5, a contract was signed with the Sellers Construction Company in the amount of $7,390,000. On December 30, a progress bill was received from Sellers in the amount of $5,000,000. The bill was paid, except for the 5 percent retained upon final inspection. On June 1, a final bill was received in the amount of $2,390,000 from Sellers, which was paid, except for the 5 percent retained. An appointment was made between the county engineer and Bill Sellers to inspect the building and to develop a list of items that needed to be corrected. On the day of the meeting, the county engineer discovered that Sellers had filed for bankruptcy and moved out of the state. The City incurred a liability in the amount of…arrow_forward
- 4.) Armstrong County established a County Office Building Construction Fund to account for a project expected to take less than one year to complete. The County's fiscal year ends on June 30. On July 1, 2023, bonds were sold at par in the amount of $7,500,000 for the project. On July 5, a contract was signed with the Sellers Construction Company in the amount of $7,390,000. On December 30, a progress bill was received from Sellers in the amount of $5,000,000. The bill was paid, except for the 5 percent retained upon final inspection. On June 1, a final bill was received in the amount of $2,390,000 from Sellers, which was paid, except for the 5 percent retained. An appointment was made between the county engineer and Bill Sellers to inspect the building and to develop a list of items that needed to be corrected. On the day of the meeting, the county engineer discovered that Sellers had filed for bankruptcy and moved out of the state. The City incurred a liability in the amount of…arrow_forwardNEED BOTH QUESTIONS. .... As the tax assessor for Indian Creek County, you have been informed that due to budgetary demands, a tax increase will be necessary next year. The total market value of the property in the county is $900,000,000. Currently, the assessment rate is 35% and the tax rate is 30 mills. The county commission increases the assessment rate to 45% and the tax rate to 35 mills. (a)How much property tax (in $) was collected under the old rates? (b)How much more tax (in $) revenue will be collected under the new rates?arrow_forward6-12: Policy Issues Relating to General Long-Term Debt. A citizens’ group in your state has placed an amendment on an upcoming election ballot. The measure would prohibit new debt issuances by state or local governments, which would presumably reduce taxes as a result of less tax-supported debt. Supporters of the amendment claim the proposed measure will force government to operate more efficiently and cut bloated spending, while opponents fear that public services and the quality of life inthe state will be severely affected if the amendment passes. Required:a. Why do governments typically issue general long-term debt? What types of services might be limited if debt was no longer a financing option? b. Consider each of the following statements regarding the amendment. Select at least one of the statements (numbered 1–4) to indicate your position on the proposed amendment. Incorporating the statement(s) selected, draft a memo supporting your position on the proposed amendment. (1).…arrow_forward
- As the tax assessor for Indian Creek County, you have been informed that due to budgetary demands, a tax increase will be necessary next year. The total market value of the property in the county is $700,000,000. Currently, the assessment rate is 35% and the tax rate is 40 mills. The county commission increases the assessment rate to 55% and the tax rate to 45 mills. (a) How much property tax (in $) was collected under the old rates? $ (b) How much more tax (in $) revenue will be collected under the new rates? $arrow_forwardSalvador County issued $25 million of 5 percent demand bonds for construction of a county maintenance building. The county has no take-out agreement related to the bonds. It estimates that 20 percent of the bonds would be demanded (called) by the buyers if interest rates increased by at least one percentage point. At year-end, rates on comparable debt were 7 percent. How should these demand bonds be reported in the governmental fund financial statements at year-end? A.) $25 million in the current liabilities section B.) $5 million in the governmental activities column AND $20 million would be reported in the schedule of changes in long-term obligations C.) $25 million in the long-term liabilities section of the governmental activities column D.) None of abovearrow_forwardAs the tax assessor for Indian Creek County, you have been informed that due to budgetary demands, a tax increase will be necessary next year. The total market value of the property in the county is $300,000,000. Currently, the assessment rate is 35% and the tax rate is 40 mills. The county commission increases the assessment rate to 55% and the tax rate to 45 mills. (a)How much property tax (in $) was collected under the old rates? (b)How much more tax (in $) revenue will be collected under the new rates?arrow_forward
- Voters of Valdez School District, a public school district, approved construction of a new high school at a cost not to exceed $20 million. The district will finance the construction by issuing $20 million of 6 percent term bonds payable in 20 years. Because the site had already been prepared, the school district began construction immediately but the bonds would not be issued for nearly a year. Shortly before the fiscal year-end, the school district borrowed $5 million from a local bank due in one year with interest at 6.2 percent. The note will be repaid from bond proceeds. The school district secured a financing agreement with the bank to convert the debt to a 10-year debt if the school district is unable to sell the bonds by the due date. At year-end, how should the $5 million note be displayed in the government-wide financial statements? A.) Notes payable-long term $5 million; B.) Notes payable-short term $5 million; C.) Nothing D.) None of abovearrow_forwardThe City of Matlock issues $20,000,000 face value of general obligation bonds for $19,920,000. The bonds will be used for the construction of new streets and sidewalks to make downtown more walkable. The City incurred $100,000 in bond issue costs. What is the amount of expenditures that the City report in its Capital Projects Fund? $108,000 $100,000 $8,000 $0arrow_forwardScenario: A city ordinance provides that “no money shall be spent for any purpose without the prior approval of the city council.” In approving the budget for the year, the council had authorized spending $1,300,000 for road maintenance. Late in the year, after the city had spent virtually the entire $1,300,000, a major storm washed out portions of several roads leading to the elementary school. The school was inaccessible, and the mayor wanted to enter into an emergency contract to repair the roads. City engineers estimated that the cost of the repairs would be about $350,000. If the city entered into such a contract, the total amount spent on road maintenance for the year would be higher than the amount authorized. Recognizing the need for prompt action, the mayor immediately entered into the contract without seeking prior city council approval. What are the legal, financial, and accounting systems implications of this scenario?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education