On July 1, 2016, the City of Corfu Received a Gift

Essay

On July 1, 2016, the City of Corfu received a gift of debt securities of XYZ Company with a nominal par) value of $1,600,000. Income is to be used to make awards for civic achievements. As of the date of the gift, the securities had a market value of $1,668,000. Included in this amount is accrued interest of $18,000. The bonds carried an annual interest rate of 5%, payable semiannually on April 1 and October 1. During the fiscal year ended June 30, 2017, the following transactions took place:
1. The gift was received.
2. On October $1 , \$ 40,000$ in interest was received
3. On April $1 , \$ 40,000$ in interest was received.
4. On April 1 , irrunediately after the receipt of irterest, the XYZ bonds were sold for $\$ 1,662,000$ . The proceeds were irvested in $\mathrm { ABC }$ bonds, which pay interest serniarrually on April 1 and October 1 . The bonds were purchased at par value.
5. On Jure 30, 2017, acened interest of $\$ 20,775$ on the ABC bonds was recogrized
6. On June 30,2017 , awards were made in the arnount of $\$ 75,000$ .
7. As of Jure 30,2017 , the fair value of the fair value of the $A B C$ bonds was $\$ 1,664,000$ , exclusive of accrued interest.
Required:
A. Record the above transactions on the books of the City of Corfu Private-Purpose Trust Fund.
B. Prepare a Statement of Changes in Fiduciary Net Position for the City of Corfu Private-Purpose Trust Fund for the year ended June 30, 2017.