Question

Record the following transactions in the journal of Capital Project Fund and
Governmental Activities. (You must prepare the journal form using Excel)

1. A capital projects fund issued $10,000,000, 5 percent bonds for $10,100,000 to finance the
construction of a little league baseball park. Premiums received are to be used to service the
debt issue.

2. The Parks and Recreation Special Revenue Fund transferred $300,000 for use in construction.

3. A construction contract was awarded in the amount of $10,200,000.

4. A bill was received from the contractor for $5,100,000

.
5. The contractor bill is paid, and 6% retain is withheld.

6. The park renovations were completed and the final bill of $5,100,000 was received. The
contractor bill and retained are approved for payment in full. Total construction expenditures
were allocated as follows: $960,000,000 to building, and the remainder to equipment.

7. The capital projects fund temporary accounts were closed, and the capital projects fund was
closed by transferring remaining funds to the debt service fund for use in debt repayment.

Answer 1

S.No.	Account Titles	Debit	Credit
1	Bank	10,100,000
	Capital Project Fund (5% Bond)		10,000,000
	Security Premium		100,000
2	Profit & Loss	300,000
	Special Reserve Fund		300,000
3	No Journal Entry
4	Contractor	5,100,000
	Bills Payable		5,100,000
5	Bills Payable	5,100,000
	Bank		4,794,000
	Retained payments payable		306,000
6
a.)	Building	9,600,000
	Equipment	600,000
	Contractor		10,200,000
b.)	Contractor	5,100,000
	Retained payments payable	306,000
	Bank		5,406,000
7
a.)	Special Reserve Fund	300,000
	Capital Project Fund (5% Bond)	9,900,000
	Contract Expense payable		10,200,000
b.)	Capital Project Fund (5% Bond)	100,000
	Security Premium	100,000
	Debt Service Fund		200,000