Journal entries--property tax accounting Prepare entries to record the following
ID: 2488187 • Letter: J
Question
Journal entries--property tax accounting
Prepare entries to record the following transactions and events related to Mason County property taxes for the year beginning January 1, 2015.
a) To raise property tax revenues of $940,000, the County sends bills to property owners totaling $945,000. This will provide a $5,000 allowance for uncollectible taxes. The County makes no provision for possible tax refunds.
b) Shortly after receiving his $5,000 tax bill, Harry appeals his assessment. His tax bill is reduced by $1,000. He then pays the remaining $4,000 that is due.
c) Mason County receives $900,000 in cash from taxpayers who make timely payment on their taxes.
d) Brown's home is destroyed by a fire; he declares bankruptcy and the County writes off his $3,000 tax bill as uncollectible.
e) Smith and Wesson, who received bill totaling $8,000 are unable to pay on time. The County bills them $300 for interest. They subsequently pay the taxes plus interest.
f) At year end, the County declares all unpaid property taxes to be delinquent. Interest and penalties amounting to $1,500 is assessed against the delinquent taxpayers.
g) The County decides to increase its Allowance for Uncollectible Taxes by $3,000
Explanation / Answer
a.
Property taxes receivable – current
$ 945,000
Allowance for uncollectible property taxes – current
$ 5,000
Revenues - property taxes
$ 940,000
b.
Cash
$ 4,000
Revenues - property taxes
$ 1,000
Property taxes receivable – current
$ 5,000
c.
Cash
$ 900,000
Property taxes receivable – current
$ 900,000
d.
Allowance for uncollectible property taxes – current
$ 3,000
Property taxes receivable – current
$ 3,000
e.
Interest and penalties receivable
$ 300
Revenues - interest and penalties
$ 300
Cash
$ 8,300
Property taxes receivable – current
$ 8,000
Interest and penalties receivable
$ 300
a.
Property taxes receivable – current
$ 945,000
Allowance for uncollectible property taxes – current
$ 5,000
Revenues - property taxes
$ 940,000
b.
Cash
$ 4,000
Revenues - property taxes
$ 1,000
Property taxes receivable – current
$ 5,000
c.
Cash
$ 900,000
Property taxes receivable – current
$ 900,000
d.
Allowance for uncollectible property taxes – current
$ 3,000
Property taxes receivable – current
$ 3,000
e.
Interest and penalties receivable
$ 300
Revenues - interest and penalties
$ 300
Cash
$ 8,300
Property taxes receivable – current
$ 8,000
Interest and penalties receivable
$ 300
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.