Assignment:
The fiscal year of Duchess County ends on December 31. Property taxes are due March 31 on the year they are levied.
Question 1. Prepare journal entries (excluding budgetary and closing entries) to record the following property tax related transactions in which the country engaged in 2007 and 2008.
a. Jan 15, 2007 the county council levied property taxes of $170million for the year ending Dec 31, 2007. Officials estimated that 1% would be uncollectible
b. During 2007 it collected $120 million
c. Jan and Feb 2008, prior to preparing its 2007 financial statements, it collected an additional $45 million in 2007 taxes. It reclassified as delinquent the $5 million of 2007 taxes not yet collected
d. Jan 2008, the county levied property taxesof $190 million, of which officals estimated 1.1 % would be uncollectible
e during the remainder of 2008 the county collected $2.5 milliom more in taxes relating to 2007, $160 million relating to 2008, and $1.9 million (in advance applicable to 2009)
f. In Dec 2008 it wrote off $1million of 2007 taxes that it determined would be uncollectible
Question 2. Suppose the county were to prepare government-wide statements and account for property taxes on a full accrual basis of accounting rather than the modified accrual bais. How would your entries differ. Explain