On October 1, the county issued a six-month, 6%, $200,000 bond anticipation note to provide temporary financing for a police station. The voters have approved the issuance of bonds to finance the project and the bonds are issued early in the following year and used to retire the note. The county government was billed $150,000 during the year on its capital project and $125,000 was paid. The government should report Capital Projects Fund expenditures for the current year ending December 31 equal to

Question

Quizplus · Accepted Answer

Capital Projects Fund expenditures are reported based on the amounts billed for the project, not on the amounts paid or the financing arrangements. Therefore, the correct answer is $150,000, which is the amount billed during the year for the capital project.

On October 1, the County Issued a Six-Month, 6%, $200,000