On the due date for bond interest, the debt service fund journal entry (or entries) will include a debit to:
A) Expenditures-Bond Interest.
B) Interfund Transfers In.
C) Appropriations.
D) Interest Expense.

Question

Quizplus · Accepted Answer

On the due date for bond interest, the debt service fund is responsible for making the interest payments on behalf of the government. Therefore, the journal entry will include a debit to Expenditures-Bond Interest to reflect the payment. This entry is similar to the entry made by a for-profit company to record interest expense. The other options listed do not reflect the actual payment of interest and are not relevant to the debt service fund's operations on the interest due date.

On the Due Date for Bond Interest, the Debt Service