Accounting For Governmental & Nonprofit Entities
18th Edition
ISBN: 9781259917059
Author: RECK, Jacqueline L., Lowensohn, Suzanne L., NEELY, Daniel G.
Publisher: Mcgraw-hill Education,
expand_more
expand_more
format_list_bulleted
Question
Chapter 4, Problem 21EP
a.
To determine
Ascertain the estimated amount of required tax anticipation note financing.
b.
To determine
Prepare
c.
To determine
Prepare journal entry to record the repayment of the tax anticipation notes in the General Fund general journal and governmental activities at the government-wide level.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The City of Iroy collects its annual property taxes late in its fiscal year. Consequently, each year it must finance part of its operating
budget using tax anticipation notes. The notes are repaid upon collection of property taxes. On April 1, the city estimated that it will
require $1,800,000 to finance governmental activities for the remainder of the fiscal year. On that date, it had $700,000 of cash on
hand and $760,000 of current liabilities. Collections for the remainder of the year from revenues other than current property taxes and
from delinquent property taxes, including interest and penalties, were estimated at $750,000.
Required
a. Calculate the estimated amount of tax anticipation financing that will be required for the remainder of the current fiscal year.
b. Assume that on April 2, the City of Troy borrowed the amount calculated in part a by signing tax anticipation notes bearing 7 percent
per annum to a local bank. Record the issuance of the tax anticipation notes in the…
1. The City of Access collects its annual property taxes late in its fiscal year. Consequently, cach year
it must finance part of its operating budget using tax anticipation notes. The notes are repaid upon
collection of property taxes. On April 1, 2016, the City estimated that it will require OMR 2,500,000 to
finance governmental activities for the remainder of the 2016 fiscal year. On that date, it had OMR
790,000 of cash on hand and OMR 830,000 of current liabilities. Collections for the remainder of FY
2016 from revenues other than current property taxes and from delinquent property taxes, including
interest and penalties, were estimated at OMR 1,100,000.
Required: Calculate the estimated amount of tax anticipation financing that will be required for the
remainder of FY 2016. Show work in good form.
3. On the last day of the calendar year, the City of Soccerton borrowed $400,000 from the local
bank as a short-term loan in anticipation of property tax collections in the month of January. The
note is non-interest bearing, due in 30 days, and is discounted as a rate of 12% per year. Record
this transaction from two perspectives: 1) from the governmental activities' perspective on the
government-wide statements, and 2) from the General Fund perspective.
(1) From the governmental activities' perspective:
Date Account Name
12/31
(2) From the General Fund perspective
Date Account Name
12/31
Debit Credit
Debit
Credit
Chapter 4 Solutions
Accounting For Governmental & Nonprofit Entities
Ch. 4 - Last month a local government collected property...Ch. 4 - When preparing the statement or schedule of...Ch. 4 - Prob. 3QCh. 4 - Prob. 4QCh. 4 - If the General Fund of a certain city needs...Ch. 4 - Prob. 6QCh. 4 - Explain why some governments may account for...Ch. 4 - Prob. 8QCh. 4 - Prob. 9QCh. 4 - Prob. 10Q
Ch. 4 - A government reports Deferred Inflows of...Ch. 4 - Prob. 13CCh. 4 - Prob. 15CCh. 4 - Choose the best answer. When equipment is...Ch. 4 - Prob. 17.2EPCh. 4 - Goods for which a purchase order had been placed...Ch. 4 - Prob. 17.4EPCh. 4 - Garden City has calculated that General Fund...Ch. 4 - Prob. 17.6EPCh. 4 - Prob. 17.7EPCh. 4 - Prob. 17.8EPCh. 4 - Carroll City levies 200,000 of property taxes for...Ch. 4 - Prob. 17.10EPCh. 4 - During the current year, the City of Hickory Hills...Ch. 4 - On July 1, 2020, the beginning of its fiscal year,...Ch. 4 - Prob. 20EPCh. 4 - Prob. 21EPCh. 4 - At the end of the current fiscal year, the City of...Ch. 4 - The City of Waterville applied for a grant from...Ch. 4 - The following transactions occurred during the...Ch. 4 - The following transactions affected various funds...Ch. 4 - The following events and transactions relate to...Ch. 4 - The City of Castletons General Fund had the...Ch. 4 - Prob. 28EP
Knowledge Booster
Similar questions
- Summer City levies $600,000 of property taxes for its current fiscal year. Three percent of the tax levy is expected to be uncollectible. The city collects $520,000 of its taxes during the year and another $50,000 during the first two months of the following year. In addition, the city collected $10,000 of prior year taxes during the first two months of the current fiscal year and another $3,000 during the remainder of the current fiscal year. What amount of property tax revenues should the city report in the governmental fund financial statements for the current fiscal year? $582,000. $573,000. $570,000. $520,000.arrow_forwardDon't give solution in image format..arrow_forwardThe following transactions relate to Newport City’s special revenue fund. In 2020, Newport City created a special revenue fund to help fund the 911 emergency call center. The center is to be funded through a legally restricted tax on cellular phones. No budget is recorded. During the first year of operations, revenues from the newly imposed tax totaled $530,000. Of this amount, $477,000 has been received in cash and the remainder will be received within 60 days of the end of the fiscal year. Expenditures (salaries) incurred through the operation of the 911 emergency call center totaled $469,000. Of this amount, $438,515 was paid before year-end. During the year the state government awarded Newport City a grant to reimburse the City’s costs (not to exceed $180,000) for the purpose of training new 911 operators. During the year, the City paid $171,000 (not reflected in the expenditures above) to train new operators for the 911 emergency call center and billed the state government.…arrow_forward
- The following transactions relate to Newport City’s special revenue fund. In 2020, Newport City created a special revenue fund to help fund the 911 emergency call center. The center is to be funded through a legally restricted tax on cellular phones. No budget is recorded. During the first year of operations, revenues from the newly imposed tax totaled $495,000. Of this amount, $445,500 has been received in cash and the remainder will be received within 60 days of the end of the fiscal year. Expenditures (salaries) incurred through the operation of the 911 emergency call center totaled $441,000. Of this amount, $412,335 was paid before year-end. During the year the state government awarded Newport City a grant to reimburse the City’s costs (not to exceed $159,000) for the purpose of training new 911 operators. During the year, the City paid $151,050 (not reflected in the expenditures above) to train new operators for the 911 emergency call center and billed the state government.…arrow_forwardThe following transactions relate to Newport City's special revenue Fund. 1. In 2020, Newport City created a special revenue fund to help the 911 emergency call center. the center is to be funded through a legally restricrted tax on cellular phones. No budget is recorded. 2. During the first year of operations, revenues from the newly imposed tax totaled $489,000. Of this amount $444,000 has been received in cash and the remainder will be received within 60 days of the end of the fiscal year.. 3. expenditures (salaries) incurred through the operation of the 911 emergency call center totaled $449,000. Of this amount $422,000 was paid before year-end. 4. During the year the state government awarded Newport City a grantto reimburse the city's cost ( not to exceed $150,000) for the pupose of training new 911 operators. During the year, the city paid $146,500 ( not relfected inthe expenditures above) to trian new operators for the 911 emergancy call center and billed the state government.…arrow_forward1. Employees of the General Fund of Scott City earn ten days of vacation for each 12 months of employment. The City permits employees to carry the vacation days forward as long as they wish. During the current year employees earned $800,000 of vacation benefits, of which the City estimates that $500,000 will be taken in the next year and the balance will be carried forward. Assuming that the City maintains its books and records in a manner that facilitates the preparation of its fund financial statements, which of the following entries is the correct entry in the General Fund to record the vacation pay earned during the current period? a. Debit Expenditures $800,000; Credit Vacation Pay Payable $800,000. b. Debit Expenditures $500,000; Credit Vacation Pay Payable $500,000. c. Debit Vacation Expense $800,000; Credit Vacation Pay Payable $800,000. d. No entry required. 2.Employees of the General Fund of Scott City earn ten days of vacation for each 12 months of employment. The City…arrow_forward
- The following transactions relate to Newport City's special revenue fund. 1. In 2024, Newport City created a special revenue fund to help fund the 911 emergency call center. The center is to be funded through a legally restricted tax on cellular phones. No budget is recorded. 2. During the first year of operations, revenues from the newly imposed tax totaled $527,500. Of this amount, $474,750 has been received in cash and the remainder will be received within 60 days of the end of the fiscal year. 3. Expenditures (salaries) incurred through the operation of the 911 emergency call center totaled $467,000. Of this amount, $436,645 was paid before year-end. 4. During the year the state government awarded Newport City a grant to reimburse the City's costs (not to exceed $178,500) for the purpose of training new 911 operators. During the year, the City paid $169,575 (not reflected in the expenditures above) to train new operators for the 911 emergency call center and billed the state…arrow_forward2. Crystal City want to complete its operation for the fiscal year 2014 and it will finance its operation by using tax anticipation notes. The notes are paid upon the collection of property taxes. On May 1, 2014, the City estimated that it will require $2,590,000 to finance governmental activities for the remainder of the 2014 fiscal year. On that date it had cash on hand $940,000 and $700,000 of current liabilities. In addition, on the same year the city will collect revenue from interest and penalties, were estimated$ 1,850,000. Required: Ccalculate the estimated amount of tax anticipation financing that will be required for the remainder of FY 2014. Show work in good form.arrow_forwardThe City of Fenton levied $3,000,000 of General Fund property taxes for the fiscal year ending December 31, 2011, with an estimated uncollectible amount of $200,000. During 2011 and January and February of 2012, $2,500,000 of the levy is expected to be collected; however, $300,000 of the levy is not expected to be collected until after February 2012. The amount of property tax revenues to be recognized in FY 2011 is:?arrow_forward
- On January 1, 2019, a city recorded General Fund property tax revenues of $750,000 but made no provision for uncollectible receivables or tax refunds. During the year, it collected property taxes of $720,000, wrote off $4,000 as uncollectible, and made tax refunds of $3,000. At year-end, the city finance director concluded that $10,000 of the delinquent taxes would be collected in January and February of 2020, $12,000 would be collected later in 2020, and $1,000 would need to be written off as uncollectible. How much should the city report as property tax revenue in its General Fund financial statements for the year 2019? a.713,000 b.730,000 c.720,000 d.742,000arrow_forwardFor fiscal 2022, Lake City levied a property tax of $270,000. The city estimated that 4% of the tax will not be collected. By fiscal year end, the city, based on the cash already collected, declares the uncollected amount of $10,200 as delinquent. Of the delinquent taxes, $5,700 is estimated to be collected within 60 days of year end and the rest is uncollectible. In fiscal 2023, Lake City collects $4,800 of the delinquent taxes and writes off the remaining delinquent taxes. Prepare the journal entries to record all the property tax transactions in fiscal 2022. Determine the amount of tax revenues reported for fiscal 2022. Prepare the journal entries to record the collection and write-off of delinquent taxes in fiscal 2023.arrow_forwardThe City of Weston is preparing its budget for calendar year 2024. After estimating revenues from all other sources, the City calculates that it must raise $6,000,000 from property taxes. You are given the following information regarding the tax rate: Property taxes to be collected $6,000,000 Allowance for uncollectible property taxes= 5% of levy Total assessed value of property $84,000,000 Assessed value of City property, not subject to tax $1,100,000 Adjustments to assessed values for senior citizen exemptions $2,200,000 The Tax rate per $100 of net assessed valuation is:arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education