Answer:
The City of Waterville
a. May 5:
Debit Cash $200,000
Credit InterFund Loan Payable $200,000
To record the loan from the general fund.
b. Debit Bridge Expenditure $165,000
Credit Vouchers Payable $165,000
To record the bridge expenditure for the year.
Debit Grant Receivable from State $165,000
Credit Grant Revenue $165,000
To record the submission of documentation for reimbursement.
c. Debit Cash $165,000
Credit Grant Receivable from State $165,000
To record the receipt of grant reimbursement.
d. Debit Revenues $165,000
Credit Expenditures $165,000
To record the revenues received and the expenditures.
Explanation:
The City of Waterville's application does not attract any journal entries. No journal entries are also made on May 1 when the city was notified of the grant award. Journal records are made from May 5 when the short-term loan arrangement was concluded with the General Fund.
