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Please, i need Unique answer, Use your own words (don't copy and paste). *Please, don't use...

Please, i need Unique answer, Use your own words (don't copy and paste).

*Please, don't use handwriting.

Course: Government and Non Profit Accounting

Exercise 1   

The Town of Hail had the following transactions.

  1. Placed a purchase order in the amount of SAR 14,000 for supplies.
  2. Placed a purchase order with a car dealer to replace the town’s only police car. The expected cost of the car is SAR 31,000.
  3. The police car was delivered to town officials with an invoice of SAR 32,500. The invoice was approved and paid.
  4. Unfortunately, some of the supplies ordered (in #1) were backordered and could not be shipped. However, supplies that were expected to cost SAR 8,000 were received along with an invoice of SAR 7,900. The invoice was paid when received.
  5. The remaining supplies that were ordered (in #1) were received. The invoice in the amount of SAR 6,000 was paid.

            Required:

Prepare the general journal entries necessary to record the budget and operating transactions 1- 5.

__________________

Case Study                                                                                                                      Dammam is the capital of the Eastern Province of Saudi Arabia. Dammam is the largest city in the Eastern Province, and the sixth largest in Saudi Arabia, after Riyadh, Jeddah, Mecca, Medina and Taif . Dammam is a major administrative center for the Saudi oil industry. Together with the nearby cities of Dhahran and Al Khobar, Dammam forms part of the Dammam Metropolitan Area, which is commonly known as greater Dammam.

Dammam Municipal Corporation is preparing its budget for calendar year 2020. After estimating revenues from all different sources like property tax, the Dammam Municipality came to a conclusion that it will collect SAR 7,000,000 and also estimated uncollectible property taxes will be SAR 70,707. In addition, Dammam Municipality is having a total estimated property at the beginning of beginning of 2020 is SAR 65,000,000 and it is expected that there will be reduction in assessed value from appeals to an amount of SAR 200,000. The corporation Assessed value of property, not subject to tax is SAR 1,400,000, and Adjustments to assessed values for senior citizen exemptions is SAR 1,000,000

Required:

            a.         Compute the gross amount of property taxes required to be levied.

            b.         Compute the tax rate per SAR100 of net assessed valuation.

            c.                     Determine the amount of property tax that a home owner whose property is assessed at SAR35,000 will have to pay.

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Answer #1

Debit Credit PO entered Encumberance for Supplies Fund Balance (reserved for encumberances) 14000 14000 PO entered Encumberance for Police Car Fund ncumberances) 31000 Balance (reserved for e 31000 Invoice entered Police car expenses 32500 Cash A/c 32500 Receipt entered Fund Balance (reserved for encumberances) 32500 Encumberance for Police Car 32500 Invoice entered Supplies expenses 7900 Cash A/c 7900 Receipt entered Fund Balance (reserved for encumberances) Encumberance for Supplies 8000 8000 Invoice entered Supplies expenses Cash A/c Receipt entered Fund Balance (reserved for encumberances) Encumberance for Supplies

solution a Gross Amount of Property taxes Property tax collected Uncollectible property tax 70707 Total 7070707 solution b Tax Rate per SAR100 Total estimated value at the beginning of year Less Reduciton in assessed value assessed value not subject to tax Senior citizen exemption 200000 1000000 2600000 Net assesseable value of property 62400000 Tax rate Gross amount of property Net assesseable value of property 7070707 62400000 0.113312612

solution c the amount of property tax that a home owner whose property is assessed at SAR35,000 will have to pay 35000 x 0.1133 3965.941426


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