Prepare the journal entries at the inception of the lease

Assignment Help Accounting Basics

Reference no: EM132711334

Questions -

Q1. A $10 million par value bond was sold at 101. The premium is transferred to the debt service fund. Create the journal entries for both funds.

Q2. The city signs several construction-related contracts for goods and services to cost $15 million.

Q3. The city receives contractor invoices for $15.1 million for construction and related services from a project. The invoices include a $300,000 additional over-time charge not included in the original contract but approved by the city controller. The city pays the invoices with 10% retention.

Q4. A capital projects fund records a liability for $50,000 a reimbursement due to the general fund for city engineering costs and project management overhead. Create journal entries for the capital projects fund and the general fund.

Q5. A capital projects fund pays costs of $15,000 related to fixing contractor errors and applies the amount to the retention account.

Q6. A capital projects fund creates a budget for a $25 million project that is being funded $15 million from a grant, $6 million from the sale of bonds, and $4 million from transfers from the general fund.

Q7. A city's capital projects fund engages in a lease for three police cars from a local car dealership. Payments are $40,000 per year for 5 years. The implicit rate of interest is 10% and a $5,000 down payment is made. The present value of the lease is $150,000. At the end of the lease, ownership transfers to the city.

Prepare the journal entries at the inception of the lease and for the first year's payment. Funding is provided by GF transfers to a DSF. Payments are made by the DSF. Identify in which fund(s) your JE's are recorded. Entries for the GF transfers are not required.

Reference no: EM132711334

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