Question: Town of Vidal uses a calendar year for its fiscal year. During 2010, the Town issued a 5-year, 9%, $150,000 note to the Bank of Vidal on January 6, 2010. The proceeds were recorded in the Capital Projects Fund. Interest and one-tenth of the principal payments are due semiannually on January 6 and July 6, beginning July 6, 2010. A Debt Service Fund has been established to service this debt. Financing will come from two sources: the General Fund and a debt service tax as approved by the Town.
The following information summarizes transactions of the Debt Service Fund during 2010:
1. Jan. 6, budget for debt service fund was approved. General Fund contribution was estimated to be $15,000. The estimated tax revenue was $30,000. The appropriations included the Jan. 6, 2011 debt service payment.
2. Debt Service Taxes levied and collected March 15, 2010 were $32,000.
3. July 6, 2010 payment of principal payment was made.
4. November 15, 2010 contribution from the General Fund of $15,000 was received.
5. The Jan. 6, 2011 principal and interest amount was accrued on year-end 2010.