Bunson Township was incorporated on January 1, Year 1, and is preparing its government-wide financial statements for the year ended December 31, Year 1. The governmental funds displayed a combined change in fund balance of $500,000 for that year and also had the following balances, data, or transactions:
Capital outlay of $250,000 partially funded by long-term debt proceeds of $225,000;
Current year depreciation of $60,000 on a capital asset base of $1,200,000;
Principal payments (on debt) of $40,000;
Interest payments (on debt) through October 1 of $30,000;
Principal payments of $10,000 incurred through December 31 but paid on January 2;
Interest payments of $7,500 incurred through December 31 but paid on January 2;
Sales tax revenues of $30,000 associated with December 31, Year 1 sales remitted to the State in February and paid to the Township in March.
The government-wide changes in net position would be displayed as:
a.
$527,500
b.
$597,500
c.
$455,000
d.
$587,500
Answer: A
I am confused on all the interest payment and principal payment part.. I get the 7500 is subtracted because incurred it under Full Accrual you need to recognize.. But what about the 10k and the 40k and 30k?? I am lost.
So I got 500K + 250K – 225K – 60K – 7.5K+30K and I went with the closest C which is wrong.
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