1. The township issues $5.0 million in bonds at a premium of $.40 million and incurs $.18 million in issue costs. The premium, net of issue costs, is transferred to a newly established debt service fund.2. The township receives $2.0 million in cash from the state for the reimbursement grant in anticipation that the township will incur at least $2.0 million in construction costs.3. The township pays $5.9 million to invest in short-term (less than one year) securities.4. The township issues purchase orders and signs construction contracts for $ 7.9 million.5. The township sells $4.0 million of its investments for $4.4 million.6. The township receives invoices totaling $6.2 million. As permitted by its agreement with its prime contractor, the township retains S.7 million pending satisfactory completion 7. 8. The township recognizes the revenue earned from the reimbursement grant.9. Anticipating that the project will be completed in the following year, ABC Construction Company pledges to contribute $1 million to West Whiteland Township. The township receives the contribution as follows:* $ 700,000 in 2023;* $100,000 in January, 2024;* $100,000 in February, 2024; and* $100,000 in March, 2024.9. By year-end, the investments still on hand decreased in value by S.25 million.Doa. Using good form, prepare journal entries to record the transactions in 2023.b. Prepare the closing entries C. Journal entries D. Income statement
1. The township issues $5.0 million in bonds at a premium of $.40 million and incurs $.18 million in issue costs. The premium, net of issue costs, is transferred to a newly established debt service fund.2. The township receives $2.0 million in cash from the state for the reimbursement grant in anticipation that the township will incur at least $2.0 million in construction costs.3. The township pays $5.9 million to invest in short-term (less than one year) securities.4. The township issues purchase orders and signs construction contracts for $ 7.9 million.5. The township sells $4.0 million of its investments for $4.4 million.6. The township receives invoices totaling $6.2 million. As permitted by its agreement with its prime contractor, the township retains S.7 million pending satisfactory completion 7. 8. The township recognizes the revenue earned from the reimbursement grant.9. Anticipating that the project will be completed in the following year, ABC Construction Company pledges to contribute $1 million to West Whiteland Township. The township receives the contribution as follows:* $ 700,000 in 2023;* $100,000 in January, 2024;* $100,000 in February, 2024; and* $100,000 in March, 2024.9. By year-end, the investments still on hand decreased in value by S.25 million.Doa. Using good form, prepare journal entries to record the transactions in 2023.b. Prepare the closing entries C. Journal entries D. Income statement
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:1. The township issues $5.0 million in bonds at a premium of $.40 million and incurs $.18
million in issue costs. The premium, net of issue costs, is transferred to a newly established
debt service fund.2. The township receives $2.0 million in cash from the state for the
reimbursement grant in anticipation that the township will incur at least $2.0 million in
construction costs.3. The township pays $5.9 million to invest in short-term (less than one
year) securities.4. The township issues purchase orders and signs construction contracts for $
7.9 million.5. The township sells $4.0 million of its investments for $4.4 million.6. The township
receives invoices totaling $6.2 million. As permitted by its agreement with its prime contractor,
the township retains S.7 million pending satisfactory completion7. 8. The township
recognizes the revenue earned from the reimbursement grant.9. Anticipating that the project
will be completed in the following year, ABC Construction Company pledges to contribute $1
million to West Whiteland Township. The township receives the contribution as follows:* $
700,000 in 2023;* $100,000 in January, 2024;* $100,000 in February, 2024; and* $100,000 in
March, 2024.9. By year-end, the investments still on hand decreased in value by S.25
million.Doa. Using good form, prepare journal entries to record the transactions in 2023.b.
Prepare the closing entries C. Journal entries D. Income statement
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