Governmental Accounting Due: Tuesday, October 17, 2017

Chapter 7 Homework Problem At the beginning of class

15 points

Record both budgetary and actual journal entries for the capital projects fund of Everett County.
Record all appropriate accruals. No closing entries are required. Assume a fiscal year end of
December 31.
20x7
1. The county issues $5,000,000 of 5%, 9 month bond anticipation notes on July 1, 20x7, to allow the
county to begin immediate construction on a new state of the art recreational baseball complex for
area youth. The bond anticipation notes are issued in relation to the upcoming bond issue that
has been approved by votes to fund the baseball complex. The bonds are legally authorized and
definitely issuable. All legal steps have been taken to refinance the BAN, and the county will
refinance the BAN on a long-term basis.
2. The county receives a federal grant of $500,000 to fund the construction of a playground to
accommodate children with special needs.
3. The county signs a construction contract with KC Enterprises for the construction of the complex.
The contract specifies that construction costs will not exceed $5,025,000.
4. The county orders playground equipment in the amount of $420,000.
5. KC Enterprises bills the county $3,200,000 for work completed by the end of fiscal year 20x7. The
county paid the amount billed less a 4% retainage to be remitted upon completion of the complex.
20x8
6. On January 1, the county issues $5,500,000 par value bonds at 101. Bond issue costs are $55,000.
7. KC Enterprises bills the county $1,000,000 for work completed in the first quarter. The county
again paid the amount billed less a 4% retainage.
8. Salaries of $25,000 are paid to the crews working on the special needs playground.
9. The county orders signage and ground covering for the special needs playground. Estimated
costs is $45,000.
10. The county receives the playground equipment order in 20x7. Actual cost is $425,000.
11. The county receives the signage for the special needs playground. Actual cost is $40,500.
12. The bond anticipation notes and interest are paid at maturity.
13. KC Enterprises submitted its final bill for $825,000. The complex was approved by the county,
and KC Enterprises was paid in full.
14. The remaining unearned portion of the grant money was refunded to the grantor.
15. The remaining cash was transferred to the Debt Service Fund.