The following data applies to the next three questions:
The City of Charlestown levied property taxes in the amount of $9,000,000. It is estimated that 2% will not be collected. The taxes were levied July 1, 2013 for the fiscal year ended June 30, 2014. During the year ended June 30, 2014, $7,900,000 in property taxes were collected from this levy. It is estimated that $620,000 will be collected during the next 60 days, $300,000 will be collected more than 60 days after June 30, 2014, and $180,000 will never be collected.
-When preparing the General Fund financial statements,how much property tax revenue should be recognized from this levy for the year ended June 30,2014?

Question

Quizplus · Accepted Answer

The amount of property taxes recognized for the year ended June 30, 2014 is calculated as follows:
$9,000,000 (original levy) - 2% ($180,000 uncollectible) = $8,820,000 (total collectible)
$8,820,000 - $620,000 (collected within 60 days) - $7,900,000 (collected during the year) = $300,000 (collected more than 60 days after June 30, 2014)
Therefore, the amount of property tax revenue recognized for the year ended June 30, 2014 is $8,520,000 ($7,900,000 + $620,000 + $300,000).

The Following Data Applies to the Next Three Questions