Caraway County financed its new $6,000,000 courthouse by issuing general obligation bonds. In the year financing was secured and construction began, the funds and/or nonfund fund accounts that would most likely be affected would be

Question

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Since the county financed its new courthouse by issuing bonds, it means that it created a Capital Projects Fund to account for the capital project activities. Thus, the Capital Projects Fund would be affected. In addition, the use of the new courthouse would significantly affect the General Capital Assets Accounts of the General Fund. Finally, the General Long-Term Liability Accounts would be affected because the county issued general obligation bonds. Thus, the best choice is D.

Caraway County Financed Its New $6,000,000 Courthouse by Issuing General