1- Why is depreciation not recorded in governmental typefunds? 2- In its General Fund balance sheet at December 31, 2015,Abbotsford City reported Property taxes receivable of $40,000,deferred property tax revenues of $15,000, and an allowance foruncollectible taxes of $0. At the start of the year 2016,Abbotsford City made the following journal entry to record itsproperty tax levy: Property taxesreceivable 950,000 Allowance for refunds and uncollectibletaxes 10,000 Revenues – property taxes 940,000 During the year 2016, the city collected all the property taxesreceivable outstanding at December 31, 2015. It also collected$920,000 of the receivables recognized at the beginning of 2016,and wrote off $6,000 of receivables against the allowance account.On December 31, 2016, the Abbotsford City finance director made thefollowing determinations regarding the property taxes outstandingat that date: a. All outstanding property taxes would becollected, so there was no need for the allowance for uncollectibleproperty taxes. b. The City would collect about $15,000 of theoutstanding property taxes receivable during the first 60 days of2017 and the remainder during the latter part of 2017.
Required: Calculate how much property tax revenues Abbotsford City shouldrecognize in 2016. 3- Prepare entries to record the following transactions relatedto acquisition of capital assets by a city.
Remark: The city does not use encumbranceaccounting.
Identify the fund(s) used. a. The city issues general obligation bonds inthe amount of $900,000, receiving cash for the full face amount ofthe bonds. The cash will be used to buy capital assets. b. The city buys a prefabricated building for $750,000,using part of the bond proceeds. The building is delivered and theinvoice for the building is approved. c. The invoice approved in b. is paid. d. The General Fund transfers cash of $55,000 toanother fund in anticipation of the payment of the firstinstallment of interest ($30,000) and principal ($25,000) on thedebt. e. The first installment of debt service on bondsissued in a. becomes due andpayable. f. Debt service on the bonds issued in a. ispaid. . . .
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