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City of Smithville Governmental Accounting
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[Para. 4-a-9] Current taxes receivable uncollected at year-end, and the related Allowance for Uncollectible Current Taxes account, were both reclassified as delinquent. Of the amount classified as delinquent it was determined $87,010 would not be collected within 60 days of the fiscal year end and would therefore be unavailable for use in the current period. As a result the amount was reclassified as deferred inflows of resources.
Required: Record the reclassification of the current taxes receivable and related allowance for uncollectible account in the General Fund and governmental activities journals.
Reclassify $87,010 of property tax revenue to the Deferred Inflows of Resources account in the General Fund journal only. (Note: To accomplish the reclassification of revenue, debit the revenue account and credit deferred inflows of resources. Select “Deferral” in the [Description] menu in the Detail Journal.)
- [Para. 4-a-10] The city’s budget for 2020 was legally amended as follows:
Estimated Revenues:
Decreases Increases
Licenses and Permits $ 20,000
Appropriations:
Public Safety $ 10,000
Culture and Recreation $ 13,000
Required: Record the budget amendments in the General Fund general journal only. Budgetary items do not affect the government-wide accounting records. (Note: Select “Budget Amendment” in the [Description] field in the Detail Journal.)
11. [Para. 4-a-11] Interest and penalties receivable on delinquent taxes was increased by $40,500; $3,248 of this was estimated as uncollectible and based on past history $8,910 was considered to be unavailable for use in the current fiscal year.
Required: Record this transaction in the General Fund and governmental activities journals. The $8,910 classified as unavailable for use is recorded as deferred inflows of resources in the General Fund journal and as revenue in the governmental activities journal.
12. [Para. 4-a-12] Services received by the General Government function of the General Fund from the Solid Waste Disposal Fund amounted to $18,200 during the year. Of this amount, $15,400 was paid in cash and $2,800 remained unpaid at year-end.
Required: Record the receipt of these services, amounts paid during the year, and remaining liability in the General Fund and governmental activities journals. At the government-wide level the liability should be credited to Internal Payables to Business-type Activities. Do not record these items in the Solid Waste Disposal Fund until instructed to do so in Chapter 7 of this case.
13. [Para. 4-a-13] Delinquent taxes receivable in the amount of $17,150 were written off as uncollectible. Interest and penalties already recorded as receivable on these taxes, amounting to $3,087, were also written off. Additional interest on these taxes that had legally accrued was not recorded since it was deemed uncollectible in its entirety.
Required: Record this transaction in the General Fund and governmental activities journals.
14. [4-a-14] In December 2020, the General Fund transferred $17,500 to the Street Improvement Bond Debt Service Fund to assist with an interest payment due on January 1, 2021.
Required: Record this transaction in the General Fund only. The transaction has no effect at the government-wide level since it occurs between two governmental activities. Do not record this transaction in the Street Improvement Bond Debt Service Fund until instructed to do so in Chapter 6 of this case.
