On June 1 2015 the City of Cape May authorized #6397

On June 1, 2015, the City of Cape May authorized the construction of a police station at an
expected cost of $250,000. Financing will be provided through transfers from a Special
Revenue Fund.The following transactions occurred during the fiscal year beginning June 1,
2015, relating to the Capital Project Fund.1. The $250,000 receivable from the Special Revenue
Fund was recorded.2. The Special Revenue Fund transferred $125,000 to the Capital Project
Fund to begin construction on the police station.3. The Capital Project Fund invested the
transfer of monies in a six-month certificate, at 5%.4. A contract in the amount of $250,000 was
let to the lowest bidder.5. Architect and legal fees in the amount of $3,125 were approved for
payment. There was no encumbrance for these expenditures.6. Contract billings in the amount
of $250,000 were approved for payment on the completion of the police station and the
encumbrance was removed.7. The six-month certificate was redeemed at maturity with interest
revenue.8. The Special Revenue Fund transferred the final amount of $125,000 to the Capital
Projects Fund.9. All liabilities except for the retention of 5% of the contract price were paid.10.
All requirements and obligations were completed; the final payment of the contract price was
made and all nominal accounts were closed.Required:Prepare the journal entries necessary in
the Capital Projects Fund to record the transactions and events described above.View Solution:
On June 1 2015 the City of Cape May authorized

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