Reference no: EM131756453

Question: Capital assets are accounted for in government-wide statements on a full accrual basis. The following summarizes the history of the Sharp City Recreation Center.

1. In 1990, the city constructed the building at a cost of $1,500,000. Of this amount, $1,000,000 was financed with bonds and the balance from unrestricted city funds.

2. In 10 years drom 1990 through 1999, the city recorded depreciation (as appropriate) based on an estimated useful life of 30 years.

3. In the same period, the city repaid $750,000 of the bonds.

4. In 2001, the sity renovated the building at a cost od $3,000,000. The entire amount was financed with unrestricted city funds. The renovation was expected to extend the useful life of the building so that it would last a total of 25 more years-that is, until 2026.

5. In the 15 years from 2001 through 2015, the city recorded depreciation (as appropriate). Depreciation was calculated by dividing the undepreciated balance of the origional cost, plus the costs of renovation, over the anticipated remaining life of 25 years.

6. In the same period, the city repaid the $250,000 balance of the debt.

7. In 2016, the city demolished the building so that the land on which it is situated could be converted into softball fields.

Required: Prepare the journal entries to summarize the history of the building as it would be reported in the city's government-wide staements.