Q: Demand bonds may provide the issuer with the disadvantages, but not
Demand bonds may provide the issuer with the disadvantages, but not the advantages, of long-term debt. On June l, 20Xl, a city issues $2 million in 7 percent demand bonds. Although the bonds have a te...
See AnswerQ: BANs, TANs, and RANs may sound alike, but they
BANs, TANs, and RANs may sound alike, but they are not necessarily accounted for in the same way. In August 20X0, voters of Balcones, a medium-sized city, approved a $15 million general obligation bon...
See AnswerQ: A government hospital entered into a licensing agreement with a commercial software
A government hospital entered into a licensing agreement with a commercial software company that would permit it to use the firm's patient billing program and related data storage facilities for a per...
See AnswerQ: Overlapping debt can significantly alter key measures of debt capacity.
Overlapping debt can significantly alter key measures of debt capacity. The following information was taken from the City of Wyoming, Michigan's, schedule of direct and overlapping debt. 1. What is th...
See AnswerQ: A lessor must report on its balance sheet both a receivable and
A lessor must report on its balance sheet both a receivable and the underlying asset. Bean County recently acquired a commercial office building at a cost $20 million, paid in cash. It estimates that...
See AnswerQ: Landfill costs must be reported as expenses during the periods of use
Landfill costs must be reported as expenses during the periods of use-but only in enterprise funds. In 2X21, a city opens a municipal landfill, which it will account for in an enterprise fund. It esti...
See AnswerQ: Decommissioning costs are often nontrivial and must be recognized years in advance
Decommissioning costs are often nontrivial and must be recognized years in advance. A city constructed a power plant at a cost of $600 million. The facility has an estimated useful life of 50 years. A...
See AnswerQ: A city entered into a contract with World Wide Construction Company (
A city entered into a contract with World Wide Construction Company (WWCC) to design, construct and operate a tunnel for a period of 30 years. Once the tunnel was completed, WWCC had complete responsi...
See AnswerQ: A state government, enters into an arrangement in which it will
A state government, enters into an arrangement in which it will transfer to the Western Tollway Corporation (WTC) a recently constructed highway. The state reports the highway on its financial stateme...
See AnswerQ: Were there any tax abatements disclosed for the year? If so
Were there any tax abatements disclosed for the year? If so, provide a brief description and the gross amount of taxes that were reduced during the reporting period.
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