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CITY OF PARIS, TEXAS Notes to Financial Statements (Continued) September 30, 2023 IV. Detailed Notes on All Activities and Funds (Continued) J. Financed Purchases (Continued) The future minimum payments required under the financing purchase and the present value of the net minimum payments as of September 30, 2023, are as follows: Year EndmE September 30,Amount ................ 2024 $ 72,353 2025 72,353 Total Minimum Payments 144,706 Less: Amount Representing Interest 6,331 Present Value of Net Minimum Payments 138,374 Less: Current Maturities of Financing Purchase Obligation (68,200)___ Long -Term Portion of Financing Purchase Obligation $ 70,174 In January 2016, the City began leasing equipment under an agreement classified as a financing purchase due to a bargain purchase option. Equipment purchased through the agreement are pledged as security for repayment of the lease liability. The present value and accumulated amortization are as follows: Financed Purchase —Equipment, at Cost $ 975,185 Less: Accumulated Amortization 651,823 Financed Purchase — Equipment, Net $ 323,362 The future minimum payments required under the financing purchase and the present value of the net minimum payments as of September 30, 2023, are as follows: Year Ending September 30, Amount 2024 _.... $ 114,337 2025 114,337 2026 114,337 Total Minimum Payments 343,011 Less: Amount Representing Interest (19,649) Present Value of Net Minimum Payments 323,362 Less: Current Maturities of Financing Purchase Obligation 104,635) Long -Term Portion of Financing Purchase Obligation $ 218,727 K. Long -Term Liabilities In the government -wide financial statements and proprietary funds in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business -type activities, or proprietary funds statement of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as expenses in the year of issuance. In the fund financial statements, governmental funds recognize bond premiums and discounts, as well as issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances 67