Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–20
Chapter 5, Solutions, Exercise 5–22 (Cont’d)
General Problem Information: Capital Projects Fund
Learning Objective: 5-4
Topic: Capital Projects Funds
5-23.
Debits Credits
1. Capital Projects Fund:
CASH 2,000,000
OTHER FINANCING SOURCES—
PROCEEDS OF BONDS 2,000,000
Governmental Activities:
2. Capital Projects Fund and Governmental Activities:
CASH 150,000
NOTES PAYABLE 150,000
3. Capital Projects Fund:
CASH 500,000
OTHER FINANCING SOURCES—PROCEEDS
OF BOND ANTICIPATION NOTES 500,000
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–21
Chapter 5, Solutions, Exercise 5–23 (Cont’d)
General Problem Information: Recording Bond Transactions
Learning Objective: 5-4
5-24. a. WOODLAND PARK CAPITAL PROJECTS FUND
STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
FOR THE YEAR END
REVENUES $ 707,000
EXPENDITURES:
CONSTRUCTION EXPENDITURES 4,150,000
EXCESS OF REVENUES AND OTHER FINANCING SOURCES
OVER EXPENDITURES 1,257,000
FUND BALANCES, BEGINNING 0
FUND BALANCES, ENDING $1,257,000
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–22
Chapter 5, Solutions, Exercise 5–24 (Cont’d)
b. WOODLAND PARK CAPITAL PROJECTS FUND
BALANCE SHEET
FOR THE YEAR END
ASSETS:
CASH $ 987,000
GRANT RECEIVABLES 600,000
LIABILITIES AND FUND BALANCES:
CONTRACTS PAYABLE 1,263,500
CONTRACTS PAYABLE—RETAINED PERCENTAGE 66,500
TOTAL LIABILITIES 1,330,000
c. It would appear that the capital project has not been completed since encumbrances
remain at year-end. Additionally, there are a number of current
receivables/payables that are open at year-end, and the ending fund balance is large.
General Problem Information: Statement of Revenues and Expenditures
Learning Objective: 5-5
Topic: Capital Projects Funds
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–23
5-25. a. SURPRISE COUNTY
Debits Credits
1. Construction Fund:
CASH 100,000
OTHER FINANCING SOURCES—PROCEEDS
OF BOND ANTICIPATION NOTES 100,000
Governmental Activities:
2. Construction Fund:
CONSTRUCTION EXPENDITURES—POLICE 30,000
Governmental Activities:
CONSTRUCTION WORK IN PROGRESS—POLICE 30,000
CONSTRUCTION WORK IN PROGRESS—FIRE 30,000
VOUCHERS PAYABLE 60,000
3. Construction Fund:
ENCUMBRANCES—POLICE 21,000,000
Governmental Activities:
NO ENTRY REQUIRED
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–24
Chapter 5, Solutions, Exercise 5-25, a. (Cont’d)
Debits Credits
4. Construction Fund:
CASH 30,000,000
OTHER FINANCING SOURCES—PROCEEDS
OF BONDS 30,000,000
Governmental Activities:
CASH 30,300,000
5. Construction Fund:
OTHER FINANCING USES—RETIREMENT OF BANs 100,000
INTEREST EXPENDITURES 1,500
CASH 101,500
Governmental Activities:
BOND ANTICIPATION NOTES PAYABLE 100,000
EXPENSES—INTEREST ON BANs 1,500
CASH 101,500
5–25
6. Construction Fund:
ENCUMBRANCES OUTSTANDING—POLICE 10,000,000
ENCUMBRANCES OUTSTANDING—FIRE 6,000,000
CONSTRUCTION EXPENDITURES—POLICE 10,000,000
CONSTRUCTION EXPENDITURES—FIRE 6,000,000
CONTRACTS PAYABLE 16,000,000
Governmental Activities:
7. Construction Fund:
CASH 500,000
REVENUES 500,000
Governmental Activities:
CASH 500,000
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–26
Chapter 5, Solutions, Exercise 5-25, a. (Cont’d)
Debits Credits
8. Construction Fund and Governmental Activities:
CONTRACTS PAYABLE 16,000,000
9. Construction Fund:
ENCUMBRANCES OUTSTANDING—FIRE 5,000,000
ENCUMBRANCES—FIRE 5,000,000
CONSTRUCTION EXPENDITURES—FIRE 5,000,000
CONTRACTS PAYABLE 5,000,000
Governmental Activities:
10. Construction Fund and Governmental Activities:
CONTRACTS PAYABLE 5,000,000
CONTRACTS PAYABLE—RETAINED PERCENTAGE 300,000
11. Construction Fund:
ENCUMBRANCES OUTSTANDING—POLICE 7,500,000
ENCUMBRANCES—POLICE 7,500,000
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–27
Chapter 5, Solutions, Exercise 5-25, a. (11) (Cont’d)
Debits Credits
CONSTRUCTION EXPENDITURES—POLICE 7,500,000
CONTRACTS PAYABLE 7,500,000
Governmental Activities:
12. Construction Fund:
OTHER FINANCING SOURCES—PROCEEDS
OF BOND ANTICIPATION NOTES 100,000
OTHER FINANCING SOURCES—PROCEEDS
OF BOND 30,000,000
REVENUES 500,000
CONSTRUCTION EXPENDITURES—POLICE 17,530,000
CONSTRUCTION EXPENDITURES—FIRE 11,030,000
Governmental Activities:
NO CLOSING ENTRY REQUIRED AS THERE ARE NO TEMPORARY
ACCOUNT BALANCES.
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–28
Ch. 5, Solutions, Exercise 5-25 (Cont’d)
SURPRISE COUNTY
CONSTRUCTION FUND
GENERAL LEDGER (NOT REQUIRED)
CASH CONTRACTS PAYABLE
(1) 100,000 (5) 101,500 (8) 16,000,000 (6) 16,000,000
(7) 500,000 (10) 5,300,000 (11) 7,500,000
CONTRACTS PAYABLE⎯
VOUCHERS PAYABLE RETAINED PERCENTAGE
(2) 60,000 (10) 300,000 (8) 800,000
ENCUMBRANCES—POLICE ENCUMBRANCES—FIRE
ENCUMBRANCES OUTSTANDING ENCUMBRANCES OUTSTANDING
—POLICE —FIRE
(6) 10,000,000 (3) 21,000,000 (6) 6,000,000 (3) 11,000,000
(11) 7,500,000 (9) 5,000,000
(2) 30,000 (12) 17,530,000 (2) 30,000 (12) 11,030,000
(6) 10,000,000 (6) 6,000,000
(11) 7,500,000 (9) 5,000,000
OFS—PROCEEDS OF BANS OFS—PROCEEDS OF BONDS
(12) 100,000 (1) 100,000 (12) 30,000,000 (4) 30,000,000
REVENUES FUND BALANCE—RESTRICTED
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–29
(12) 500,000 (7) 500,000 (12) 1,938,500
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–30
Ch. 5, Solutions, Exercise 5-25 (Cont’d)
b. SURPRISE COUNTY
CONSTRUCTION FUND
BALANCE SHEET
DECEMBER 31, 2023
ASSETS
CASH $ 9,998,500
TOTAL ASSETS $ 9,998,500
LIABILITIES AND FUND BALANCES
LIABILITIES:
VOUCHERS PAYABLE $ 60,000
FUND BALANCES:
FUND BALANCE—RESTRICTED 1,938,500
TOTAL LIABILITIES AND FUND BALANCES $9,998,500
(Note that encumbrances and encumbrances outstanding are not reported on the balance
sheet. They are budgetary accounts that represent construction commitments.)
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–31
Ch. 5, Solutions, Exercise 5-25 (Cont’d)
c. SURPRISE COUNTY
CONSTRUCTION FUND
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCES
FOR THE PERIOD ENDED DECEMBER 31, 2023
REVENUES $ 500,000
EXPENDITURES:
CONSTRUCTION EXPENDITURES—POLICE 17,530,000
TOTAL EXPENDITURES 28,561,500
EXCESS OF EXPENDITURES OVER REVENUES 28,061,500
OTHER FINANCING SOURCES (USES):
RETIREMENT OF BOND ANTICIPATION NOTES (100,000)
TOTAL OTHER FINANCING SOURCES (USES) 30,000,000
EXCESS OF REVENUES AND OTHER FINANCING
d. In the Governmental Activities column of the statement of net position, the fire
station will be reported with other buildings, net of depreciation, if any is taken in
the first year. The police facility construction expenditures of $17,530,000 for this
year will appear as construction work in progress in the capital assets section. The
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–32
Ch. 5, Solutions, Exercise 5-25 (Cont’d)
General Problem Information: Multi-project Construction Fund
Learning Objective: 5-2
Learning Objective: 5-4
Learning Objective: 5-5
5-26. a. SOUTHFORK
SENIOR CENTER CAPITAL PROJECTS FUND
Debits Credits
1. CASH 500,000
2. CONSTRUCTION EXPENDITURES 400,000
CASH 400,000
4. ENCUMBRANCES 4,950,000
ENCUMBRANCES OUTSTANDING 4,950,000
5. CASH 5,000,000
6. INVESTMENTS 3,500,000
CASH 3,500,000
7. CONSTRUCTION EXPENDITURES 49,500
DUE TO OTHER FUNDS 49,500
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–33
Ch. 5, Solutions, Exercise 5-26, part a. (Cont’d)
Debits Credits
8. ENCUMBRANCES OUTSTANDING 1,500,000
CONSTRUCTION EXPENDITURES 1,500,000
ENCUMBRANCES 1,500,000
CONTRACTS PAYABLE 1,500,000
9. CONTRACTS PAYABLE 1,500,000
10. DUE TO OTHER FUNDS 25,000
VOUCHERS PAYABLE 47,500
CASH 72,500
12. OTHER FINANCING SOURCES—
INTERFUND TRANSFERS IN 500,000
OTHER FINANCING SOURCES—
PROCEEDS OF BONDS 5,000,000
REVENUES 100,000
FUND BALANCE—RESTRICTED 2,500,000
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–34
Ch. 5, Solutions, Exercise 5-26 (Cont’d)
SOUTHFORK
SENIOR CENTER CAPITAL PROJECTS FUND
GENERAL LEDGER (NOT REQUIRED)
CASH
(1) 500,000 (2) 400,000
(11) 100,000 (9) 1,425,000
(10) 72,500
INVESTMENTS
(6) 3,500,000
CONTRACTS PAYABLE
(9) 1,500,000 (8) 1,500,000
CONTRACTS PAYABLE⎯RETAINED PERCENTAGE
(9) 75,000
FUND BALANCE—RESTRICTED
(12) 2,500,000
FUND BALANCE—ASSIGNED
(12) 1,055,500
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–35
Ch. 5, Solutions, Exercise 5–26 (Cont’d)
OTHER FINANCING SOURCES—INTERFUND TRANSFERS IN
(12) 500,000 (1) 500,000
OTHER FINANCING SOURCES—PROCEEDS OF BONDS
(12) 5,000,000 (5) 5,000,000
ENCUMBRANCES OUTSTANDING
(8) 1,500,000 (4) 4,950,000
CONSTRUCTION EXPENDITURES
(2) 400,000 (12) 2,044,500
(7) 49,500
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–36
Ch. 5, Solutions, Exercise 5-26 (Cont’d)
b. SOUTHFORK
SENIOR CENTER CAPITAL PROJECTS FUND
STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED
REVENUES $ 100,000
EXPENDITURES:
CONSTRUCTION EXPENDITURES 2,044,500
PROCEEDS OF BONDS SOLD 5,000,000 5,500,000
EXCESS OF REVENUES AND OTHER
SOURCES OVER EXPENDITURES 3,555,500
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–37
Ch. 5, Solutions, Exercise 5–26 (Cont’d)
c. SOUTHFORK
SENIOR CENTER CAPITAL PROJECTS FUND
BALANCE SHEET
AS OF YEAR END
ASSETS
CASH $ 202,500
INVESTMENTS 3,500,000
TOTAL ASSETS $3,702,500
LIABILITIES AND FUND BALANCES
LIABILITIES:
VOUCHERS PAYABLE $ 47,500
FUND BALANCES:
FUND BALANCE—RESTRICTED $2,500,000
FUND BALANCE—ASSIGNED 1,055,500
TOTAL FUND BALANCES 3,555,500
TOTAL LIABILITIES AND FUND BALANCES $3,702,500
(Note that encumbrances and encumbrances outstanding are not reported on the balance
sheet. They are budgetary accounts that represent construction obligations, and for
Chapter 05 – Accounting for General Capital Assets and Capital Projects
5–38
Ch. 5, Solutions, Exercise 5-26 (Cont’d)
General Problem Information: Capital Project Transactions
Learning Objective: 5-2
Learning Objective: 5-4
Learning Objective: 5-5