The journal entry for the Debt Service fund upon the receipt of money from the General Fund would be:

Question

Quizplus · Accepted Answer

When money is transferred from the General Fund to the Debt Service Fund, the journal entry for the Debt Service Fund should include a debit to Cash, indicating an increase in its funds, and a credit to Transfer In, which represents the source of the funds. Therefore, option C is the correct answer. Option A is incorrect because Transfers Payable is used to record money owed by the government to other funds outside of the current fund. Option B is incorrect because Transfer In should be credited with the same value as the transfer from the General Fund. Option D is incorrect because Transfer Out is used for recording money leaving the current fund to other funds outside of it.  So, in this case, it does not apply.

The Journal Entry for the Debt Service Fund Upon the Receipt