Author Question: All companies must use a calendar year as their fiscal year. a. True b. False Indicate whether ... (Read 56 times)

BrownTown3 · **on:** Jul 5, 2018

All companies must use a calendar year as their fiscal year.
a. True
b. False

Indicate whether the statement is true or false

Question 2

(Journal entries - tax revenue accounting - year-end adjustments)

Prepare entries to record the following transactions and events related to Colfax County's tax revenues for the year beginning January 1, 2013:

a. To raise property tax revenue of 800,000, the County bills its property owners a total of 802,000, providing 2,000 for uncollectible and refundable taxes.
b. During the year, taxpayers pay a total of 750,000 in property taxes.
c. E. Bloodworth declares bankruptcy, owing the County 2,000 in property taxes. The County writes off the unpaid amount as uncollectible.
d. The state collects sales taxes on behalf of Colfax County. It sends the County 150,000 for sales taxes collected during the year.
e. At year-end, the County declares all unpaid property taxes to be delinquent.
f. To prepare financial statements for the year, the County comptroller makes the following determinations regarding tax revenues:
(1) She estimates that Colfax will receive 20,000 in delinquent 2013 property taxes before the end of February, 2014 The other delinquent taxes will trickle in later in 2014
(2) She learns that the state will remit 10,000 to Colfax in January 2014 for sales taxes collected by merchants in December 2013

Liddy · **Reply #1 on:** Jul 5, 2018

Answer to Question 1

False

Answer to Question 2

a. Property taxes receivable 802,000
Allowance for refunds and uncollectible taxes 2,000
Revenues - property taxes 800,000

b. Cash 750,000
Property taxes receivable 750,000

c. Allowance for refunds and uncollectible taxes 2,000
Property taxes receivable 2,000

d. Cash 150,000
Revenues - sales taxes 150,000

e. Property taxes receivable - delinquent 50,000
Property taxes receivable 50,000

f1 . Revenues - property taxes 30,000
Deferred revenues - property taxes 30,000

f2 . Sales taxes receivable 10,000
Revenues - sales taxes 10,000