The options are:
A) Transfer the remaining funds to the General Fund to pay operating expenses.
B) Transfer the remaining funds to the debt service fund that will be handling the long-term debt incurred for the construction of the building.
C) Return the excess to the source of the restricted funding.
D) All of the above may be appropriate ways to treat the fund balance.
Answer:
D) All of the above may be appropriate ways to treat the fund balance.
Step-by-step explanation:
Maxim county used a capital projects fund to account for the construction of the new building, the following ways can be used to treat the excess of $12,000.
- We could transfer the excess of $12,000 to general fund to pay for operating expenses incurred.
- The excess could also offset some of the long term debt incurred when constructing the building.
- Finally the excess can be returned to source.