The City of Smithfield levied property taxes in and for 2014 in the amount of $200 million.It is estimated that 1% will be uncollectible.During 2014,$180 million was collected,and $12 million was collected during the next 60 days.Smithfield recognizes the maximum possible property taxes in its governmental funds.The adjustment,when moving from the governmental funds changes in fund balances to the governmental activities change in net assets would be:

Question

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Smithfield recognizes the maximum possible property taxes, which means it recognizes the full $200 million minus the 1% estimated uncollectible amount ($2 million), resulting in $198 million. Since $192 million was collected within the availability period ($180 million in 2014 and $12 million in the next 60 days), the adjustment needed is $6 million to account for the remaining amount expected to be collected beyond the availability period.

The City of Smithfield Levied Property Taxes in and for 2014