In 2020, Sunrise City Signed a Contract in the Amount

question 38

Multiple Choice

In 2020, Sunrise City signed a contract in the amount of $8,000,000 for the construction of a new city hall. Expenditures were $4,000,000 in 2020 and $2,050,000 in 2021, which included a change to the original construction design in the amount of $50,000. What amount should be added to capital assets in the governmental activities accounts in 2021?

• A) $0
• B) $50,000
• C) $2,050,000
• D) $2,000,000

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Definitions:

Net Purchases

The total amount of purchases made by a business minus returns, allowances, and discounts.

Intraperiod Tax Allocation

The process of apportioning income taxes within a single fiscal period among different sections of a financial statement.

Extraordinary Items

Events and transactions that are distinct from the ordinary activities of a company and have a significant impact on its financial position.

Discontinued Operations

Parts of a company's business that have been sold, disposed of, or otherwise terminated, which are reported separately from continuing operations in financial statements.