Chapter 6: Accounting for General Long- Term

If bonds are sold at a premium:

All of the above statements are true.

Debt service funds may be used to account for all of the following except

Amortization of premiums on bonds payable.

Payment of general obligation bond interest would be recorded as

An expenditure in the debt service fund general journal.

Annual lease payments

Are recorded at both the fund and government-wide levels.

Long-term liabilities of a government

Both a and c are true.

Proceeds from bonds issued to construct a new city hall would most likely be recorded in the journal of the

Capital projects fund.

Which of the following would not be considered a general long-term liability?

Capitalized equipment leases of the water utility fund.

Which one of the following statements regarding debt margin is correct?

Debt margin is the difference between the legal debt limit and the amount of net indebtedness subject to limitation.

The liability for long-term debt issued to finance a capital project will appear in which financial statement?

Government-wide statement of net position.

Budgeting entries for a debt service fund would

Include appropriations forPage 251 principal payments that will become legally due during the fiscal year.

Debt issuance costs

Include legal and administrative fees associated with bond issuance.

On March 2, 2020, 20-year, 6 percent, general obligation serial bonds were issued by Mossy County at the face amount of $3,000,000. Interest of 6 percent per year is due semiannually on March 1 and September 1. The first principal payment of $150,000 is due on March 1, 2021. The county's fiscal year-end is December 31. What amounts are reported as interest expense in the government-wide financial statements and interest expenditure in the debt service fund for 2020?

Interest Expense Interest Expenditure $150,000 $90,000

Total general long-term indebtedness subject to debt margin calculations typically does not include

Lease obligations.

The liability for special assessment bonds for which the city is not obligated in any manner should be recorded in a

None of the fund or governmental activities general journals but should be disclosed in the notes to the financial statements.

Which of the following items would be reported in the Governmental Activities column of the government-wide financial statements?

Premium on bonds payable - YES Non-current portion of general long-term liabilities payable - YES