The City of Amarillo is authorized to issue $8,400,000, 4percent regular serial bonds in 2017 for the construction a newexit off the interstate highway within city limits. The bondsmature in equal annual amounts beginning on January 1, 2018 for 10years and pay interest on January 1 and July 1. The city isrequired to use all accrued interest and premiums to service thedebt. The funds to pay the interest will be transferred from theGeneral Fund. The countyâs fiscal year end is December 31.
a. Prepare the budgetary entries for 2017 assuming that thebonds were scheduled to be issued on January 2. Assume that theJanuary 1, 2018 principal and interest payments will be included inthe 2018 budget.
b. The bonds were sold on February 1, 2017 at 101. Prepare thejournal entries needed to record the issuance of the bonds,including the entries required in the debt service fund and anyentries required in the governmental activities general ledger atthe government-wide level.
c. Prepare the entry required to reflect the transfer of fundsfrom the General Fund in the debt service fund. (You may ignore theentry in the General Fund.)
d. Prepare the journal entries needed to record first interestpayment made on July 1, including the entries required in the debtservice fund and any entries required in the governmentalactivities general ledger at the government-wide level. Assume thatthe straight-line method is used for premium amortization.
The City of Amarillo is authorized to issue $8,400,000, 4percent regular serial bonds in 2017 for the construction a newexit off the interstate highway within city limits. The bondsmature in equal annual amounts beginning on January 1, 2018 for 10years and pay interest on January 1 and July 1. The city isrequired to use all accrued interest and premiums to service thedebt. The funds to pay the interest will be transferred from theGeneral Fund. The countyâs fiscal year end is December 31.
a. Prepare the budgetary entries for 2017 assuming that thebonds were scheduled to be issued on January 2. Assume that theJanuary 1, 2018 principal and interest payments will be included inthe 2018 budget.
b. The bonds were sold on February 1, 2017 at 101. Prepare thejournal entries needed to record the issuance of the bonds,including the entries required in the debt service fund and anyentries required in the governmental activities general ledger atthe government-wide level.
c. Prepare the entry required to reflect the transfer of fundsfrom the General Fund in the debt service fund. (You may ignore theentry in the General Fund.)
d. Prepare the journal entries needed to record first interestpayment made on July 1, including the entries required in the debtservice fund and any entries required in the governmentalactivities general ledger at the government-wide level. Assume thatthe straight-line method is used for premium amortization.