1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Lisa [10]
3 years ago
7

The City of Troy collects its annual property taxes late in its fiscal year. Consequently, each year it must finance part of its

operating budget using tax anticipation notes. The notes are repaid upon collection of property taxes. On April 1, the city estimated that it will require $2,500,000 to finance governmental activities for the remainder of the fiscal year. On that date, it had $770,000 of cash on hand and $830,000 of current liabilities. Collections for the remainder of the year from revenues other than current property taxes and from delinquent property taxes, including interest and penalties, were estimated at $1,100,000.
Required:
Calculate the estimated amount of tax anticipation financing that will be required for the remainder of the current fiscal year. Assume that on April 2, the City of Troy borrowed the amount calculated in part a by signing tax anticipation notes bearing 6 percent per annum to a local bank. Record the issuance of the tax anticipation notes in the general journals of the General Fund and governmental activities at the government-wide level. By October 1, the city had collected a sufficient amount of current property taxes to rep
Business
1 answer:
Digiron [165]3 years ago
7 0

Answer:

A. $1,460,000

B. General Fund:

Dr Cash $1,460,000

Cr Tax Anticipation Notes Payable $1,460,000

Governmental Activities:

Dr Cash $1,460,000

Cr Tax Anticipation Note Payable $1,460,000

C. General Fund:

Dr Tax Anticipation Note Payable $1,460,000

Dr Expenditures $43,800

Cr Cash $1,503,800

Governmental Activities:

Dr. Tax Anticipation Note Payable $1,460,000

Dr Expenses-General Government $43,800

Cr Cash $1,503,800

Explanation:

A. Calculatation for the estimated amount of tax anticipation financing

Estimated Expenditures Requirements:

Budgeted Expenditure, remainder $2,500,000

Add Current Liabilities Payable $830,000

Total $3,330,000

Estimated Resources Available:

Cash on hand $770,000

Add Collection of budgeted revenues and delinquent property taxes $1,100,000

Total $1,870,000

Estimated Anticipation Note Financing $1,460,000

($3,330,000-$1,870,000)

Therefore the Estimated Anticipation Note Financing is $1,460,000

B. Preparation of the journal entry to record the issuance of the tax anticipation notes in the general journals

General Fund:

Dr Cash $1,460,000

Cr Tax Anticipation Notes Payable $1,460,000

( To record the insuance of tax anticipation note payable)

Governmental Activities:

Dr Cash $1,460,000

Cr Tax Anticipation Note Payable $1,460,000

C. Preparation of the general journals of the General Fund and governmental activities

General Fund:

Dr Tax Anticipation Note Payable $1,460,000

Dr Expenditures $43,800

(1,460,000*6%*6/12)

Cr Cash $1,503,800

(1,460,000+43,800)

Governmental Activities:

Dr. Tax Anticipation Note Payable $1,460,000

Dr Expenses-General Government $43,800

(1,460,000*6%*6/12)

Cr Cash $1,503,800

(1,460,000+43,800)

(Being the payment for tax and interest)

You might be interested in
The omission of the adjusting entry to record depreciation expense will result in an
Gemiola [76]

Answer:

B.overstatement of assets and an overstatement of owners' equity.

Explanation:

To recognize depreciation expense,the entries required are

Debit depreciation expense

Credit Accumulated depreciation

The accumulated depreciation is a credit balance in the fixed asset account. Depreciation is also an expense that reduces net income and thus reduces the owners equity.

Hence an mission of the adjusting entry to record depreciation expense will result in an overstatement of assets and an overstatement of owners' equity.

6 0
3 years ago
Sandra has two credit cards, P and Q. Card P has a balance of $726.19 and an interest rate of 10.19%, compounded semiannually. C
Elan Coil [88]
First, convert interest to the effective annual interest rate using this formula:

(1 + i/m)^m - 1, where m = 2 for semiannual and m = 12 for monthly. Then, use this formula to find the future worth:

F = P(1+i)^n, where P is $726.19 and <span>$855.20, respectively, for Card P and Q. n is equal to 4.

Card P: F = 1080.704
Card Q: F = 1206.284

Then, find the amount decrease by subtracting F - P.

Card P: F - P = $354.514
Card Q: F - P = $351.084

The difference between the two is $3.43. Thus, the answer is C.</span>
5 0
3 years ago
Read 2 more answers
A share of common stock just paid a dividend (D0) of $1.50. If the expected long-run growth rate for this stock is 5%, and if in
skelet666 [1.2K]

Answer:

Current stock price = $24.23

Explanation:

Stock price under Discounted Model:

P0 = D1 \div(Ke - g)

P0 = Current Market price of the share

g = Growth rate = 5.0%

Ke = Cost of equity = 11.5% p.a

D1 = Expected dividend = $1.50 (1 + 0.05)= $1.575

P0 = $1.575 / (11.50% - 5.0%)

Current stock price = $24.23

8 0
3 years ago
What is the value of (123)°?​
Maksim231197 [3]

Explanation:

The value refers to the worth of each digit depending on where it lies in the number. We calculate it by multiplying the place value and face value of the digit. Value=Place Value × Face Value. For instance: If we consider a number 45.

5 0
2 years ago
Marley designs and manufactures specialty furniture. She has a number of unique products but can only produce in limited quantit
sukhopar [10]

Answer:

Marley could not meet a rapid rise in demand

Explanation:

  • A marketing penetration strategy means that a business deliberately reduces the product offered to the market. The purpose of setting a lower price is to entice consumers to buy the product, thereby creating demand for it.
  • The penetration strategy discourages other companies from entering the market. Marketers who use this strategy want to establish a large market share for a product in a short period of time.
  • Mary cannot implement a market entry strategy because of limited production capacity. This approach increases production demand in a short period of time. Mary cannot afford the increase in demand at the moment.

7 0
2 years ago
Other questions:
  • For​ August, Bletchley Blinds will have cash receipts of​ $97,000 and cash disbursements of​ $108,000. If its beginning cash is​
    5·1 answer
  • In the context of dollar-value LIFO, what is a LIFO layer?
    9·1 answer
  • Inefficient capitalism socialism or communism
    10·1 answer
  • currently, a firm has an EPS of $2.08 and a benchmark PE of 12.7. Earning are expected to grow by 3.8 percent annually. What is
    8·1 answer
  • A man purchased a $23,000, 1-year term-life insurance policy for $425. Assuming that the probability that he will live for anoth
    14·1 answer
  • For use in a linear regression model, categorize which of the following variables should be represented as dummy variables and w
    15·1 answer
  • A small multifamily property generates $50,000 in rental income, $10,000 in expenses, and $25,000 in debt service. The property
    9·1 answer
  • SwiftyCompany is considering two capital investment proposals. Estimates regarding each project are provided below:
    5·1 answer
  • On a piece of paper or on a device with a touch screen, hand write the solution to the following problem. Then photograph or sav
    7·1 answer
  • A likely outcome from taxing the rich at a high percentage in order to ________ income, would be discouraged entrepreneurship an
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!