Question

The county collector of Suncoast County is responsible for collecting all property taxes levied by funds and governments within the boundaries of the county. To reimburse the county for estimated administrative expenses of operating the tax agency fund, the agency fund deducts 3.5 percent from the collections for the town, the school district, and the other towns. The total amount deducted is added to the collections for the county and remitted to the Suncoast County General Fund.

The following events occurred in 2017:

1.	Current-year tax levies to be collected by the agency were:

County General Fund	$	10,533,000
Town of Bayshore General Fund		4,940,000
Suncoast County Consolidated School District		6,650,000
Other towns		3,320,000
Total	$	25,443,000

2.	$13,900,000 of current taxes was collected during the first half of 2017.
3.	Liabilities to all funds and governments as a result of the first half-year collections were recorded. (A schedule of amounts collected for each participant, showing the amount withheld for the county General Fund and net amounts due the participants, is recommended for determining amounts to be recorded for this transaction.)
4.	All cash in the tax agency fund was distributed.

5.

Required information

Required
a.	Prepare journal entries for each of the foregoing transactions that affected the tax agency fund. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.)

       

6.

Required information

b.

Prepare journal entries for each of the foregoing transactions that affected the Suncoast County General Fund. Begin with the tax levy entry, assuming 4 percent of the gross levy will be uncollectible. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.)

       

7.

Required information

c.

Prepare journal entries for each of the foregoing entries that affected the Town of Bayshore General Fund. Begin with the tax levy entry, assuming 2 percent of the gross levy will be uncollectible. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.)

      

8.

Required information

d.	Which financial statements would be prepared by the tax agency fund? (Select all that apply.)

Answer 1

a. Description	Sl. No.	Journal Entry	Amount (Dr.)	Amount (Cr.)
Creation of asset for amount recoverable on account of taxes and liability to pay to the respective funds	1	Taxes Receivable A/C. Dr.	$25,443,000
		Due to General County Fund Cr.		$11,054,850
		Due to Town Of Bayshore General Fund Cr.		$4,767,100
		Due to Sun Coast Country Consolidated School Cr.		$6,417,250
		Due to Other Towns Cr.		$3,203,800
		(AS per Working Note 2)
Entry For Cash Received	2	Cash A/c. Dr.	$13,900,000
		Taxes Receivable A/c. Cr.		$13,900,000
Entry for Distribution of the Cash Received	3	Due to General County Fund Cr.	$6,039,477
		Due to Town Of Bayshore General Fund Cr.	$2,604,358
		Due to Sun Coast Country Consolidated School Cr.	$3,505,867
		Due to Other Towns Cr.	$1,750,298
		Cash A/c. Dr.		$13,900,000
		(As per working Note 2)

b.

Assuming 4% of Amount is not collectible(25443000*4%)	1	Unreceoveable Taxes A/c Dr.	$1,017,720
		To Tax Receivable A/c.		$1,017,720
Writing off Liability	2	Due to General County Fund Dr.	$442,194
		Due to Town Of Bayshore General Fund Dr.	$190,684
		Due to Sun Coast Country Consolidated School Dr.	$256,690
		Due to Other Towns Dr.	$128,152
		Unreceoveable Taxes A/c Cr.		$1,017,720
		(Distribution of Unrecoverable Taxes) - As per working Note 3