Question

A government has the following debt: Capital lease liabilities that mature in more than one year (General Fund department leases)-$2,000,000. Net pension liability associated with general government employees-$4,000,000. General government bonds that mature in the next fiscal year-$14,000,000. What amount of debt should be reported in the long-term liabilities in the government-wide financial positions?

Answer 1

Answer:

Total debt= $20,000,000

Explanation:

Long term liabilities are what the government owes that are due in more than one year.

All the stated items are unmatured long term liabilities that will appear on the government wide financial position.

Although these items will not be recorded in government general funds.

Therefore

Total debt = Capital lease liabilities that mature in more than one year + Net pension liability associated with general government + General government bonds that mature in the next fiscal year

Total debt= 2,000,000+ 4,000,000+ 14,000,000

Total debt= $20,000,000