A city uses a Library Fund to account for proceeds restricted for an addition to the main library and construction of neighborhood libraries.The Library Fund is a:
A)Capital Projects Fund
B)General Fund
C)Permanent Fund
D)Debt Service Fund
E)Private-Purpose Trust Fund

Question

Quizplus · Accepted Answer

A Capital Projects Fund is used to account for financial resources that are restricted, committed, or assigned for capital outlays. These outlays include the acquisition or construction of capital facilities or other fixed assets. As the Library Fund is used to account for proceeds restricted for the addition of the main library and construction of neighborhood libraries, it falls under the definition of a Capital Projects Fund.

A City Uses a Library Fund to Account for Proceeds