Problem -
Assuming that a Sparrow City maintains its books and records in a manner that facilitates the preparation of the fund financial statements, prepare all necessary journal entries to record the following events related to property tax revenues for the year ended Dec. 31, 2013. The city has adopted the 60-day rule for all revenue recognition for which it is appropriate.
Required: Prepare appropriate journal entries.
a. On Jan. 3, the city council levied property taxes of $1 million to support general government operations, due in two equal installments on June 20 and Dec. 20. The property taxes were levied to finance the 2013 budget, which had been adopted on Nov. 3, 2013. Historically, 2% of property taxes are uncollectible.
b. The City collected the following amounts in 2013 related to property taxes:
Delinquent 2011 taxes collected in January 2012 $ 11,000
Delinquent 2011 taxes collected in March 2012 12,500
2013 taxes collected in June 2013 540,000
2013 taxes collected in December 2013 400,000
c. Delinquent 2013 property taxes were reclassified as delinquent after the June payment date.
d. The City collected the following amounts in 2014 related to property taxes:
Delinquent 2013 taxes collected in January 2014 10,000
Delinquent 2013 taxes collected in March 2014 15,000
e. $2,000 of 2011 taxes were written off during 2013.
The City of Jonesboro engaged in the following transactions during the fiscal year ended Sept. 30, 2015.
Required: Record the following transactions related to interfund transfers. Be sure to make ALL necessary entries and to indicate in which fund the entry is being made.
a. The City transferred $300,000 from the general fund to the debt service fund to make the interest payments due during the fiscal year. The payments due during the fiscal year were paid. The City also transferred $150,000 from the general fund to the debt service fund to advance fund the $150,000 interest payment due Oct. 15, 2013.
b. The City transferred $75,000 from the air operations special revenue fund to the general fund to close out the operations of that fund.
c. The City transferred $130,000 from the general fund to the city electric utility enterprise fund to pay for the utilities used by the general and administrative offices during the year.
d. The City transferred the actuarially determined pension contribution of $2 million from the general fund to the City's pension trust fund.
e. The City deposited into the general fund the proceeds of a $5.5 million dollar bond issue. The bonds were sold for $5.6 million.