Use the Following to Answer the Next Four Questions

question 71

Multiple Choice

Use the following to answer the next four questions:
On April 1, 2015, the City of Southern Ponds issued $3,500,000 in 4% general obligation, tax supported bonds at 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,490,000 was used to construct the police station, which was completed before December 31, 2015, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2015, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $175,000 is due April 1, 2016.
-What amount would be reported as debt service expenditures for 2015?

• A) $ -0-.
• B) $ 70,000.
• C) $140,000.
• D) $245,000.

---

Definitions:

Possessors

Individuals or entities that have control over or hold property, but do not necessarily own it.

Real Estate

Property consisting of land and the buildings on it, along with its natural resources.

Social Guests

Individuals who are invited to visit someone's home or attend a private function or gathering without any expectation of providing a service or receiving payment.

Licensees

Individuals or entities that are granted permission to do certain things by another’s leave, such as occupying or using someone’s property.