Create journal entries in the general fund

Assignment Help Taxation

Reference no: EM1375492

Property taxes are not unavoidably recognized as revenue in the year collected. The fiscal year of Duchess County ends on 31st December. Property taxes are due 31st March of the year in which they are levied and intended to finance.

1. Create journal entries (excluding closing entries) in the general fund (modified accrual basis) to record the subsequent property tax- related transactions in which the county engaged in 2012 and 2013.

a. On 15th January, 2012 the county council levied property taxes of $170 million for the year ending 31st December, 2012. Officials estimated that 1 percent would be uncollectible.

b. During 2012 it collected $120 million.

c. In January and February 2013, prior to preparing its 2012 financial statements, it collected an extra $45 million in 2012 taxes. It reclassified the $5 million of 2012 taxes not yet collected as delinquent.

d. In January 2013 county levied property taxes of $190 million to finance activities of
2013; officials estimated that 1.1 percent were uncollectible.

e. During remainder of 2013 the county collected $2.5 million more in taxes relating to 2012, $160 million relating to 2013, and $1.9 million applicable to 2014.

f. In December 2013 it wrote off $1 million of 2012 taxes that it evaluated was uncollectible.

2. What amount of property tax revenue could the county report in its government-wide statements for 2012 and 2013? Describe.

Reference no: EM1375492

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