D is corrent because per GASB Codification Section 1500, the proceeds of long-term debt issues not recorded as fund liabilities (for example, proceeds of bonds or notes expended through capital projects funds) should be reported as bond issue proceeds.
A is incorrect because although this transaction does increase the fund balance of the Capital Projects Fund, it is first recorded in a nominal account which is later closed to the fund balance.
B is incorrect because per GASB Codification Section 1700, appropriations constitute maximum expenditure authorizations during a fiscal year and is a budgetary account used to integrate the budget into the accounting system.
C is incorrect because bonds payable is not credited in the Capital Projects Fund. Per GASB Codification Section 1500, long-term liabilities of the Capital Projects Fund are reported in the government-wide Statement of Net Position, not in the governmental funds statement.
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