Question: (Journal entries in a Debt Service Fund) Green Valley issued $20,000,000 of general obligation bonds to construct a multipurpose arena. These bonds will be serviced by a tax on the revenue from events held in the arena and will mature in 2017. During 2012, Green Valley budgeted $2,500,000 of tax revenues and $2,000,000 for interest on the bonds in its Debt Service Fund. Prepare the journal entries necessary to record
(a) the budget and
(b) the expenditure when the interest comes due for payment.