A government levies property taxes and awards discounts for timely payment. How should the government report discounts that it expects will be taken?

Question

Quizplus · Accepted Answer

The government should deduct from the amount of taxes levied to determine the amounts to be reported as property tax revenues and/or deferred inflows of resources. This is because the discounts are a reduction of revenue, rather than an expenditure or financing use. The discounts are expected to be taken by taxpayers and therefore should be accounted for as a reduction in revenue.

A Government Levies Property Taxes and Awards Discounts for Timely