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goji.go goji.go
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Posts: 5977
Rep: 293 0
9 years ago
The City of Jonesboro allows discounts on taxes. Specifically, taxpayers get a 1% discount on the total tax if it is paid within one month of the initial levy. What would the journal entry be to record the levy of $700,000 if the government anticipates there will be a 2% uncollectible rate and it is anticipated that the discounts will be $5,000?

      Debit   Credit
A.   Taxes Receivable
   Allowance for Uncollectible Taxes
   Allowance for Discounts
   Revenues   $700,000   
$14,000
5,000
681,000
B.   Taxes Receivable
   Revenues   $700,000   $700,000
C.   Taxes Receivable
Expenditures
   Allowance for Uncollectible Taxes
   Revenues   $695,000
5,000   

$14,000
686,000
D.   Taxes Receivable
   Allowance for Uncollectible Taxes
   Revenues   $700,000   
$14,000
686,000
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3 Replies
Diesel
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Answer accepted by topic starter
f_zah1f_zah1
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#1
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9 years ago
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goji.go Author
wrote...
#2
9 years ago
Thanks so much f_zah1.

You were correct Smiling Face with Open Mouth
Diesel
wrote...
#3
9 years ago
You're very welcome!
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