The Green Hills Water District was established on January 1 to provide water service to a suburban development. It accounts for its operations in a single enterprise fund. During the year it engaged in the following transactions:
1.It issued $6,000,000 of revenue bonds.
2.For $4,500,000, it purchased the plant and equipment of the private water company that previously served the area.
3.It incurred $500,000 in costs to improve and expand its plant and equipment.
4.It billed customers for $1.8 million, of which it collected $1.5 million.
5.It billed and collected $200,000 in tap connection fees from developers. The actual cost of the hookups (paid in cash) was $140,000.
6.It incurred the following operating costs (all paid in cash):
Purchases of water, $850,000
Labor and contract services, $320,000
Interest, $80,000
Supplies and miscellaneous, $60,000
7.It recognized depreciation of $350,000 on its capital assets.
a.Prepare journal entries to record the transactions.
b.Prepare a year-end statement of revenues, expenses, and changes in net assets.
c.Prepare a year-end balance sheet.