Dungannon Township's council approved the modification of the town hall entrance to comply with the Americans with Disabilities Act. The township issued $50,000 of bond anticipation notes at face amount and placed the proceeds in a Capital Projects Fund. Although Dungannon completed all of the necessary legal steps to refinance the notes, the township was unable to consummate the refinancing. In the Capital Projects Fund, the $50,000 note issuance should be reported as Other
$\begin{array}{llll}
&&&\text {Other}\
&&&\text {Financing}\&\text { Liability } &\text { Revenues } &\text { Sources }\end{array}$

Question

Quizplus · Accepted Answer

The $50,000 note issuance is a liability because it represents borrowed funds that will need to be repaid. It is not a revenue source because it does not represent an increase in the township's financial resources. It is not an "other financing source" because the funds were not received as a result of a long-term debt issuance. Therefore, the correct choice is A, which reflects that the $50,000 note issuance should be reported as a liability in the Capital Projects Fund.

Dungannon Township's Council Approved the Modification of the Town Hall OtherFinancing Liability Revenues Sources \begin{array}{llll}&&&\text {Other}\\&&&\text {Financing}\\&\text { Liability } &\text { Revenues } &\text { Sources }\end{array}​ Liability ​ Revenues ​OtherFinancing Sources ​

Dungannon Township's Council Approved the Modification of the Town Hall $\begin{array}{llll}&&&\text {Other}\\&&&\text {Financing}\\&\text { Liability } &\text { Revenues } &\text { Sources }\end{array}$