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Calhoun County makes annual transfers from the general fund to the debt service fund to pay principal and interest on long-term debt.
-When the County makes the transfer the entry in the debt service fund should be
A)Debit Cash; Credit Revenue.
B)Debit Cash; Credit Other financing sources-transfer.
C)Debit Cash; Credit Interest payable.
D)Debit Cash with fiscal agent; Credit Other financing sources-transfer.

Question

Use the following information to answer questions 
Calhoun County makes annual transfers from the general fund to the debt service fund to pay principal and interest on long-term debt.
-When the County makes the transfer the entry in the debt service fund should be
A)Debit Cash; Credit Revenue.
B)Debit Cash; Credit Other financing sources-transfer.
C)Debit Cash; Credit Interest payable.
D)Debit Cash with fiscal agent; Credit Other financing sources-transfer.

Quizplus · Accepted Answer

When the County makes transfers from the general fund to the debt service fund, it is considered an "other financing source-transfer" and the entry should be a debit to cash and a credit to other financing sources-transfer.

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