As of May 30,20X9,the debt service fund of Cody had accumulated $52,000 of assets in a debt service fund to pay the principal of its currently maturing serial bonds.On June 1,20X9,$50,000 of serial bonds matured and were paid with the resources accumulated in the debt service fund.In Cody's debt service fund,Matured Bonds Payable was debited for $50,000 and:

Question

Quizplus · Accepted Answer

When the matured serial bonds are paid with the resources available in the debt service fund, the debit entry will be made to the Matured Bonds Payable account, and the credit entry will be made to the Cash account. Therefore, choice A is the correct option. Choice B is incorrect because the Due to General Fund account is used to record the transfer of resources from the general fund to the debt service fund, which is not applicable in this scenario. Choice C is incorrect because investments are not relevant in this scenario as the debt service fund is created to pay the principal of the maturing serial bonds. Choice D is incorrect because the Reserve for Encumbrances account is used to record encumbrances or commitments, which are not relevant in this scenario.

As of May 30,20X9,the Debt Service Fund of Cody Had