The accompanying statements of the parks recreations and

municipal capital
The accompanying statements of the parks, recreations, and municipal capital improvement
bond fund (a capital projects fund) were drawn from an annual report of Parkville. According to a
note in the report (the only one pertaining to the fund), the fund is maintained "to account for
bond proceeds to be utilized for the construction and refurbishment of parks and recreation
facilities and the refurbishment of other municipal facilities."1. The variances in expenditures
between budget and actual are substantial. What is the most likely explanation?2. A schedule of
long?term debt payable (in the statistical section of the report) indicates that only $7 million, of
parks, recreation, and municipal capital improvement bonds were authorized and issued. How
do you reconcile that amount with the proceeds from bonds payable reported in the statement
of revenues, expenditures, and changes in fund balance?3. Another schedule of transfers
between funds (in the same section) indicates that $131 thousand was transferred to the
general fund. What conclusions can you draw about whether interest on fund investments must
be used either to repay the capital improvement bonds or to construct and refurbish city
facilities?4. How much of fund resources did the government spend during the year on capital
improvements?5. How do you explain the absence in the balance sheet of "construction in
process?"6. Why is a major portion of the fund balance "restricted?"Parks, Recreation, and
Municipal Capital Improvement Bond Fund Balance SheetDecember 31, 2018 (in
thousands)AssetsReceivables.............................................$
2Investments..........................................5,874Total
assets.........................................$5,876Liabilities and Fund BalanceLiabilitiesAccrued wages
and salaries..........................$ 4Construction contracts payable.....................202Due to other
funds....................................220Total liabilities.......................................$ 426Fund
BalanceRestricted for bond projects......................5,019Committed..........................................$
431Total fund balance................................$5,450Total liabilities and fund
balance...............$5,876 View Solution: The accompanying statements of the parks recreations
and municipal capital
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