As of December 31, 2019, Westport had $9,500,000 in 4.5 percent serial bonds outstanding. The serial bonds pay interest semiannually on July 1 and December 31, with $500,000 in bonds being retired on each interest payment date. Resources for payment of principal and interest are transferred from the General Fund. Prepare debt service fund and government-wide entries in general journal form to reflect, as necessary, the following information and transactions for FY 2020. (1) The operating budget for FY 2020 consists of other financing sources (transfers from the General Fund) equal to estimated principal and interest payments. Appropriations also must be provided for interest payments and bond redemptions on July 1 and December 31. (If no entry is required for a transaction/event, select
"No Journal Entry Required" in the first account field.)(2) Cash was received from the General Fund and checks were written and mailed for the July 1 principal and interest payments.
What will be an ideal response?
(1)
| ? | Debits | Credits |
| Serial Bond Debt Service Fund: | ? | ? |
| ESTIMATED OTHER FINANCING SOURCES | 1,416,250 | ? |
| APPROPRIATIONS | ? | 1,416,250 |
Budget For FY 2020: Interest = $9,500,000 × 0.045 × ½ For July 1 payment = $213,750 and $9,000,000 × 0.045 × ½ = $202,500 for December 31 payment, two principal payments = $1,000,000.
Governmental Activities: No entries required
(2)
| Serial Bond Debt Service Fund: | ? | ? |
| CASH | 713,750 | ? |
| OTHER FINANCING SOURCES-INTERFUND TRANSFERS IN | ? | 713,750 |
EXPENDITURES-BOND INTEREST | 213,750 | ? |
| EXPENDITURES-BOND PRINCIPAL | 500,000 | ? |
| CASH | ? | 713,750 |
Governmental Activities: | ? | ? |
| INTEREST EXPENSE | 213,750 | ? |
| BONDS PAYABLE | 500,000 | ? |
| CASH | ? | 713,750 |
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