Following are selected transactions of the Town of Seneca Falls during 2020:
1) A capital projects fund is established for the construction of a new addition to the courthouse. The cost of the project is budgeted at $25,000,000. Funding is to come from the following sources: general obligation bond issue, $15,000,000, grant from the federal government, $10,000,000, and temporary funding from the general fund, $1,000,000.
2) The general fund advances the agreed-upon $1,000,000 for the project. It expects repayment within 60 days of year-end.
3) The general obligation bond issue yields a total of $15,100,000. Per town requirements, the premium is transferred to the debt service fund for eventual payment of bond principal.
4) The federal government pays $6,000,000 on the grant, with the remainder expected within 60 days of year-end.
5) Bids are taken for the building, and a contract for $24,200,000 is awarded to the qualified low bidder.
6) Invoices of $18,600,000 are received, representing payments due for partial completion of the contract. The town pays $18,300,000 of the invoices.
7) The town makes $375,000 in interest and $200,000 in principal payments on the bonds. The general fund made a transfer of $575,000 to the debt service fund, as specified in the town budget, to finance these payments.
Required
Prepare the following financial statements:
a. Capital projects fund statement of revenues, expenditures, and changes in fund balance for the year 2020, and balance sheet as of 2020 year-end.
b. Debt service fund statement of revenues, expenditures, and changes in fund balance for the year 2020, and balance sheet as of 2020 year-end.

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The Answer of Following are selected transactions of the Town of Seneca Falls during 2020:
1) A capital projects fund is established for the construction of a new addition to the courthouse. The cost of the project is budgeted at $25,000,000. Funding is to come from the following sources: general obligation bond issue, $15,000,000, grant from the federal government, $10,000,000, and temporary funding from the general fund, $1,000,000.
2) The general fund advances the agreed-upon $1,000,000 for the project. It expects repayment within 60 days of year-end.
3) The general obligation bond issue yields a total of $15,100,000. Per town requirements, the premium is transferred to the debt service fund for eventual payment of bond principal.
4) The federal government pays $6,000,000 on the grant, with the remainder expected within 60 days of year-end.
5) Bids are taken for the building, and a contract for $24,200,000 is awarded to the qualified low bidder.
6) Invoices of $18,600,000 are received, representing payments due for partial completion of the contract. The town pays $18,300,000 of the invoices.
7) The town makes $375,000 in interest and $200,000 in principal payments on the bonds. The general fund made a transfer of $575,000 to the debt service fund, as specified in the town budget, to finance these payments.
Required
Prepare the following financial statements:
a. Capital projects fund statement of revenues, expenditures, and changes in fund balance for the year 2020, and balance sheet as of 2020 year-end.
b. Debt service fund statement of revenues, expenditures, and changes in fund balance for the year 2020, and balance sheet as of 2020 year-end.

Following Are Selected Transactions of the Town of Seneca Falls