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The citizens of a specific area of the City of Arlington approved the construction of sidewalks in their residential neighborhood and approved a $1 million bond issue to finance construction of those sidewalks.The citizens agreed to assess themselves for 20 years in an amount sufficient to pay principal and interest on the bonds.The City will oversee the construction of the sidewalks and act as agent for servicing the debt.The City does not guarantee the debt nor does it assume any legal or moral obligation for the bonds.
-The proceeds of the bond issue should be recorded in which fund of the City of Arlington?
A)Agency Fund.
B)Special Assessment Fund.
C)Capital Projects Fund.
D)Debt Service Fund.

Question

Use the following information to answer questions 
The citizens of a specific area of the City of Arlington approved the construction of sidewalks in their residential neighborhood and approved a $1 million bond issue to finance construction of those sidewalks.The citizens agreed to assess themselves for 20 years in an amount sufficient to pay principal and interest on the bonds.The City will oversee the construction of the sidewalks and act as agent for servicing the debt.The City does not guarantee the debt nor does it assume any legal or moral obligation for the bonds.
-The proceeds of the bond issue should be recorded in which fund of the City of Arlington?
A)Agency Fund.
B)Special Assessment Fund.
C)Capital Projects Fund.
D)Debt Service Fund.

Quizplus · Accepted Answer

The proceeds of the bond issue should be recorded in the Capital Projects Fund as it is a long-term debt financing capital project.

Use the Following Information to Answer Questions