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logiol22 logiol22
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Posts: 699
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5 years ago
The City of Jonesboro awards discounts on taxes for timely payment. 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? Record as if all taxes are expected to be collected during the year.

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

$14,000
686,000
D.Taxes ReceivableCurrent
Allowance for Uncollectible TaxesCurrent
RevenuesTaxes$700,000
$14,000
686,000
Textbook 
Governmental and Nonprofit Accounting

Governmental and Nonprofit Accounting


Edition: 11th
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freshcofreshco
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5 years ago
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logiol22 Author
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#2
5 years ago
I wanna give this person a hug.
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