Question

Benton County includes an independent school district and two individually chartered towns within the County. Benton County's Treasurer assesses and collects property taxes on behalf of itself, the school district, and the towns. The County uses a tax collection custodial fund to record tax collections for the school district and towns. During the year ended December 31, 2020, the following transactions took place:

1. The County Levied taxes as follows

Benton County General Fund $25,000,000

School District $12,500,000

Towns $2,500,000

Total $40,000,000

2. The property taxes levied in part (a) were collected.

3. The amounts collected were paid to the school district and towns.

Required:

a. Prepare journal entries for Benton County and the Benton County Independent School District--identify the funds.

Answer 1

1. Tax collection custodial fund DR $ 12,500,000

To school district A/C CR $ 12,500,000

  

2. Benton county a/c DR $ 12,500,000

To Tax collection custodial fund CR $ 12.500.000

3. Tax collection custodial fund DR $ 2,500,000

To Towns a/c CR $ 2,500,000

4. Benton county a/c DR $2,500,000

To Tax collection custodial fund CR $2,500,000

5. Benton county a/c DR $ 25,000,000

To Benton county a/c CR $ 25,000,000

6. School a/c DR $ 33,333,333

Towns a/c DR $ 6,666,666

To Benton county a/c CR $ 40,000,000