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Government accounting

28/10/2020 Client: mmm78901 Deadline: 7 Days

 750 WORDS


Your city has decided to build a new library. The projected cost is $2 million. A bond issue for $1.2 million has been authorized, and the remainder is supposed to come from a contribution of $800,000 from the general fund. The bonds sold for $1.3 million, a premium of $100,000. Create the required journal entries for the following transactions:



  • The budget for the library

  • The payment and receipt of funds from the general fund

  • The issuance of the bonds

    • Assume that the premium remained in the capital projects fund.

    • Identify all of the funds required for these entries.

    • Discuss how the bond premium could be disposed.




In general terms, compare and contrast how expenditures are controlled in the general fund and in debt service funds. Explain why differences would occur.



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