A city government has a nine-year capital lease for property being used within the General Fund. The lease was signed on January 1, 2010. Minimum lease payments total $90,000 starting at the end of the first year but have a current present value of $69,000. Annual payments are $10,000, and the interest rate being applied is 10 percent. When the first payment is made on December 31, 2010, which of the following recordings is made?
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Government-Wide Statements
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Fund-Based Statements
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a. Interest Expense $-0-
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Interest Expense $-0-
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b. Interest Expense $6,900
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Expenditures $6,900
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c. Expenditures $10,000
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Expenditures $10,000
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d. Interest Expense $6,900
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Expenditures $10,000
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