Question

Benton County maintains a tax agency fund for use by the County Treasurer to record receivables, collections, and disbursements of all property tax collections to all other units of government in the county. For FY 2016–2017, the following taxes were assessed:

Benton County General Fund	$	18,270,000
Town of Thomas		6,007,000
Town of Hart		4,005,000
Benton County School District		18,273,000
Various Special Districts		4,806,000
Total	$	51,361,000

During the first six months of the fiscal year, the following transactions took place:

1. The tax levy became effective. All units of government provided for an estimated 2 percent in uncollectible taxes.
2. Cash collections of the first installment of taxes were as follows:

Benton County General Fund	$	8,760,000
Town of Thomas		3,604,000
Town of Hart		2,403,000
Benton County School District		8,761,000
Various Special Districts		1,125,000
Total	$	24,653,000

3. Record the liability to the other governmental units, assuming that the county General Fund charges other governments 1.5 percent of all tax collected because the county General Fund incurs all costs of billing, recording, and collecting taxes.
4. Cash was paid to the various governmental units.
   

Required:
a. Record the transactions on the books of the Benton County Tax Agency Fund.
b. Record the transactions on the books of the Benton County General Fund.
c. Record the transactions on the books of the Town of Thomas.

Answer 1

solution

a. Record the Transaction on the books of the Benton Country Tax Agency Fund
Benton County Tax Agency Fund
General Journal
FY 2016/2017
Event	Account Title	Debit	Credit
1	Taxes Receivable for Other Governments - Current ($51361000 - $18273000))	$33,088,000
	Due to Other Funds and Units		$33,088,000
2	Cash ($24,653,000 - $8,760,000)	$15,893,000
	Taxes Receivable for Other Governments - Current		$15,893,000
3	Due to Other Funds and Units	$15,893,000
	Due to the Benton County General Fund ($15893000*1.5%)		$238,395
	Due to Town of Thomas ($3604000*0.985)		$3,549,940
	Due to Town of Hart ($2403000*0.985)		$2,366,955
	Due to Benton County School District ($8761000*0.985)		$8,629,585
	Due to Various Special Districts ($1125000*0.985)		$1,108,125
4	Due to the Benton County General Fund	$238,395
	Due to Town of Thomas	$3,549,940
	Due to Town of Hart	$2,366,955
	Due to Benton County School District	$8,629,585
	Due to Various Special Districts	$1,108,125
	Cash		$15,893,000
b. Record the Transaction on the books of the Benton Country General Fund
Benton County General Fund
General Journal
FY 2016/2017
Event	Account Title	Debit	Credit
1	Tax Receivable - Current	$18,270,000
	Estimated Uncollectible Current Taxes ($18270000*2%)		$365,400
	Revenues		$17,904,600
2	Cash	$8,760,000
	Tax Receivable - Current		$8,760,000
3	Due from the Tax Agency Fund	$238,395
	Revenues		$238,395
4	Cash	$238,395
	Due from the Tax Agency Fund		$238,395
c.. Record the Transaction on the books of the Town of Thomas
Town of Thomas
General Fund
General Journal
FY 2016/2017
Event	Account Title	Debit	Credit
1	Tax Receivable - Current	$6,007,000
	Estimated Uncollectible Current Taxes ($6007000*2%)		$120,140
	Revenues		$5,886,860
2	Due from Tax Agency Fund ($3604000*0.985)	$3,549,940
	Expenditures ($3604000*1.5%)	$54,060
	Tax Receivable - Current		$3,604,000
4	Cash	$3,549,940
	Due from the Tax Agency Fund		$3,549,940