On July 1, 2020, the beginning of its fiscal year, Ridgedale County recorded gross property tax levies of $4,200,000. The county estimated that 2 percent of the taxes levied would be uncollectible. As of April 30, 2021, the due date for all property taxes, the county had collected $3,900,000 in taxes. During the current fiscal year, the county collected $53,000 in delinquent taxes and $4,800 in interest and penalties on the delinquent taxes. The county imposed penalties and interest in the amount of $14,500 but only expects to collect $12,800 of that amount. At the end of the fiscal year (June 30, 2021), uncollected taxes, interest, and penalties are reclassified. They are not expected to be collected within the first 60 days for the following fiscal year. Required Record entries for the above transactions as stated in the individual statements below, and post corresponding information into the Revenues ledger as appropriate. a. Prepare journal entries to record the tax levy on July 1, 2020, in the General Fund. (Ignore all entries in the governmental activities journal.) b. Prepare a summary journal entry to record the collection of current taxes as of April 30. c. Prepare a summary journal entry to record the collection of delinquent taxes, interest, and penalties. (You may assume that these amounts had been designated Deferred Inflows of Resources.) d. Prepare the journal entry necessary to reclassify the uncollected tax amounts as delinquent. Assume these taxes are not expected to be collected within 60 days of year-end. e. Prepare the journal entry necessary to record interest and penalties if they are not expected to be collected soon after year-end.
On July 1, 2020, the beginning of its fiscal year, Ridgedale County recorded gross property tax levies of $4,200,000. The county estimated that 2 percent of the taxes levied would be uncollectible. As of April 30, 2021, the due date for all property taxes, the county had collected $3,900,000 in taxes. During the current fiscal year, the county collected $53,000 in delinquent taxes and $4,800 in interest and penalties on the delinquent taxes. The county imposed penalties and interest in the amount of $14,500 but only expects to collect $12,800 of that amount. At the end of the fiscal year (June 30, 2021), uncollected taxes, interest, and penalties are reclassified. They are not expected to be collected within the first 60 days for the following fiscal year. Required Record entries for the above transactions as stated in the individual statements below, and post corresponding information into the Revenues ledger as appropriate. a. Prepare journal entries to record the tax levy on July 1, 2020, in the General Fund. (Ignore all entries in the governmental activities journal.) b. Prepare a summary journal entry to record the collection of current taxes as of April 30. c. Prepare a summary journal entry to record the collection of delinquent taxes, interest, and penalties. (You may assume that these amounts had been designated Deferred Inflows of Resources.) d. Prepare the journal entry necessary to reclassify the uncollected tax amounts as delinquent. Assume these taxes are not expected to be collected within 60 days of year-end. e. Prepare the journal entry necessary to record interest and penalties if they are not expected to be collected soon after year-end.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On July 1, 2020, the beginning of its fiscal year, Ridgedale County recorded gross property tax levies of $4,200,000. The county
estimated that 2 percent of the taxes levied would be uncollectible. As of April 30, 2021, the due date for all property taxes, the county
had collected $3,900,000 in taxes. During the current fiscal year, the county collected $53,000 in delinquent taxes and $4,800 in
interest and penalties on the delinquent taxes. The county imposed penalties and interest in the amount of $14,500 but only expects
to collect $12,800 of that amount. At the end of the fiscal year (June 30, 2021), uncollected taxes, interest, and penalties are
reclassified. They are not expected to be collected within the first 60 days for the following fiscal year.
Required
Record entries for the above transactions as stated in the individual statements below, and post corresponding information into the
Revenues ledger as appropriate.
a. Prepare journal entries to record the tax levy on July 1, 2020, in the General Fund. (Ignore all entries in the governmental activities
journal.)
b. Prepare a summary journal entry to record the collection of current taxes as of April 30.
c. Prepare a summary journal entry to record the collection of delinquent taxes, interest, and penalties. (You may assume that these
amounts had been designated Deferred Inflows of Resources.)
d. Prepare the journal entry necessary to reclassify the uncollected tax amounts as delinquent. Assume these taxes are not expected
to be collected within 60 days of year-end.
e. Prepare the journal entry necessary to record interest and penalties if they are not expected to be collected soon after year-end.
Transcribed Image Text:View transaction list
Journal entry worksheet
<
1
Event
a
Note: Enter debits before credits.
2
Record the tax levy on July 1, 2020 in the General Fund.
Record entry
Show Transcribed Text
Req A to E
Journal Entries
3
Account / Description
Taxes
Property Tax
Interest and Penalties
Delinquent Taxes
Property Tax
Interest and Penalties
4
mwy w
Subsidiary
Ledger
Show subsidiary detail for the Revenues ledger.
5 6 7
Deferred Inflows of Resources
Property Tax
Interest and Penalties
General Journal
Clear entry
C
< Req A to E Journal Entries
Debit
RIDGEDALE COUNTY
Revenues Ledger
Est. Revenues Dr(Cr) Revenues Cr(Dr) Balance Dr(Cr)
View general journal
>
Credit
Req A to E Subsidiary Ledger >
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