Advanced Accounting 14th Edition
14th Edition
ISBN: 9781260726442
Author: By Joe Ben Hoyle And Thomas Schaefer And Timothy Doupnik
Publisher: Mc Grawhill Education
expand_more
expand_more
format_list_bulleted
Question
Chapter 17, Problem 3Q
To determine
Explain the information must the city provide in its financial statements to inform taxpayers and other interested parties about the nature of this tax abatement. Officials for the city of Winfield have agreed to forgo real estate taxes normally charged to J Corporation for the subsequent 10 years. In exchange, J Corporation has agreed to build a distribution facility that is expected to hire 500 new employees.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Officials for the city of Winfield have agreed to forgo real estate taxes normally charged to Jamieson Corporation for the subsequent 10 years. In exchange, Jamieson has agreed to build a distribution facility that is expected to hire 500 new employees. What information must the city provide in its financial statements to inform taxpayers and other interested parties about the nature of this tax abatement?
Officials for the city of Winfield have agreed to forgo real estate taxes normally charged to Jamieson Corporation for the subsequent 10 years. In exchange, Jamieson has agreed to build a distribution facility that is expected to hire 500 new employees. What information must the city provide in its financial statements to inform taxpayers and other interested parties about the nature of this tax abatement?
4P
A city agrees to allow the Jones Company to operate within its geographical boundaries without having to pay real estate taxes for the following 10 years. In exchange, Jones agrees to continue employing at least 120 people at all times. For this tax abatement, which of the following does the city not have to disclose?
The party receiving the tax abatement.
The purpose of the tax abatement program.
Dollar amount of taxes abated.
The tax being abated
A city agrees to allow the Jones Company to operate within its geographical boundaries without having to pay real estate taxes for the following 10 years. In exchange, Jones agrees to continue employing at least 120 people at all times. For this tax abatement, which of the following does the city not have to disclose?
The party receiving the tax abatement.
The purpose of the tax abatement program.
Dollar amount of taxes abated.
The tax being abated
Knowledge Booster
Similar questions
- A city agrees to allow the Jones Company to operate within its geographical boundaries without having to pay real estate taxes for the following 10 years. In exchange, Jones agrees to continue employing at least 120 people at all times. For this tax abatement, which of the following does the city not have to disclose? Choose the correct.a. The party receiving the tax abatement.b. The purpose of the tax abatement program.c. Dollar amount of taxes abated.d. The tax being abated.arrow_forwardA city provides a local business with a tax abatement so that real estate taxes will be avoided for the next five years. In exchange, the business agrees to construct a new facility to hire 50 or more individuals. How is this reported? Only on the government-wide financial statements. Only on the fund financial statements. On both the government-wide and fund financial statements. Only as a footnote disclosure.arrow_forwardA city provides a local business with a tax abatement so that real estate taxes will be avoided for the next five years. In exchange, the business agrees to construct a new facility to hire 50 or more individuals. How is this reported? Choose the correct.a. Only on the government-wide financial statements.b. Only on the fund financial statements.c. On both the government-wide and fund financial statements.d. Only as a footnote disclosure.arrow_forward
- Superior Developers sells lots for residential development. When lots are sold, Superior recognizes income for financial reporting purposes in the year of the sale. For some lots, Superior recognizes income for tax purposes when the cash is collected. In 2020, Superior sold lots for $20 for which no cash was collected at the time of the sale. This cash will be collected equally over 2021 and 2022. The enacted tax rate was 40% at the time of the sale. In 2021, a new tax law was enacted, revising the tax rate from 40% to 25% beginning in 2022. Calculate the total amount by which Superior should change its deferred tax liability in 2021.arrow_forwardIn 2020 Metro City received $250,000 of tax underpayments and paid $80,000 in refunds based on taxpayers filing their 2019 returns in 2020. In addition, in 2020 the city received $700,000 in withholding and estimated tax payments for 2020. The city conducted audits in 2019 and assessed and billed tax deficiencies of $30,000 of which it collected $25,000 in 2019 and $5,000 in 2020. The city conducted audits in 2020 and assessed and billed tax deficiencies of $40,000 of which it collected $36,000 in 2020. Required; Calculate the amount of Income Tax Revenue that Metro City should report on its 2020 Fund Financial Statements.arrow_forwardSuperior Developers sells lots for residential development. When lots are sold, Superior recognizes income for financial reporting purposes in the year of the sale. For some lots, Superior recognizes income for tax purposes when collected. In the prior year, income recognized for financial reporting purposes for lots sold this way was $20 million, which would be collected equally over the next two years. The enacted tax rate was 40%. This year, a new tax law was enacted, revising the tax rate from 40% to 35% beginning next year. Calculate the amount by which Superior should reduce its deferred tax liability this year.arrow_forward
- The following transactions relate to Newport City’s special revenue fund. In 2020, Newport City created a special revenue fund to help fund the 911 emergency call center. The center is to be funded through a legally restricted tax on cellular phones. No budget is recorded. During the first year of operations, revenues from the newly imposed tax totaled $530,000. Of this amount, $477,000 has been received in cash and the remainder will be received within 60 days of the end of the fiscal year. Expenditures (salaries) incurred through the operation of the 911 emergency call center totaled $469,000. Of this amount, $438,515 was paid before year-end. During the year the state government awarded Newport City a grant to reimburse the City’s costs (not to exceed $180,000) for the purpose of training new 911 operators. During the year, the City paid $171,000 (not reflected in the expenditures above) to train new operators for the 911 emergency call center and billed the state government.…arrow_forwardThe following transactions relate to Newport City’s special revenue fund. In 2020, Newport City created a special revenue fund to help fund the 911 emergency call center. The center is to be funded through a legally restricted tax on cellular phones. No budget is recorded. During the first year of operations, revenues from the newly imposed tax totaled $495,000. Of this amount, $445,500 has been received in cash and the remainder will be received within 60 days of the end of the fiscal year. Expenditures (salaries) incurred through the operation of the 911 emergency call center totaled $441,000. Of this amount, $412,335 was paid before year-end. During the year the state government awarded Newport City a grant to reimburse the City’s costs (not to exceed $159,000) for the purpose of training new 911 operators. During the year, the City paid $151,050 (not reflected in the expenditures above) to train new operators for the 911 emergency call center and billed the state government.…arrow_forwardFor fiscal 2022, Lake City levied a property tax of $270,000. The city estimated that 4% of the tax will not be collected. By fiscal year end, the city, based on the cash already collected, declares the uncollected amount of $10,200 as delinquent. Of the delinquent taxes, $5,700 is estimated to be collected within 60 days of year end and the rest is uncollectible. In fiscal 2023, Lake City collects $4,800 of the delinquent taxes and writes off the remaining delinquent taxes. Prepare the journal entries to record all the property tax transactions in fiscal 2022. Determine the amount of tax revenues reported for fiscal 2022. Prepare the journal entries to record the collection and write-off of delinquent taxes in fiscal 2023.arrow_forward
- The recent implementation of TCJA Act of 2017 limits the deductions for state and local taxes, which includes property taxes and sales taxes, to a maximum amount of $10,000 each year. Is the IRS taking drastic steps towards curbing home ownership? Does this place a disproportionate burden on taxpayers residing in states with higher market values on residential property?arrow_forwardAs the tax assessor for Indian Creek County, you have been informed that due to budgetary demands, a tax increase will be necessary next year. The total market value of the property in the county is $700,000,000. Currently, the assessment rate is 35% and the tax rate is 30 mills. The county commission increases the assessment rate to 55% and the tax rate to 35 mills. (a) How much property tax (in $) was collected under the old rates? $ (b) How much more tax (in $) revenue will be collected under the new rates? $arrow_forwardThe following transactions relate to Newport City's special revenue Fund. 1. In 2020, Newport City created a special revenue fund to help the 911 emergency call center. the center is to be funded through a legally restricrted tax on cellular phones. No budget is recorded. 2. During the first year of operations, revenues from the newly imposed tax totaled $489,000. Of this amount $444,000 has been received in cash and the remainder will be received within 60 days of the end of the fiscal year.. 3. expenditures (salaries) incurred through the operation of the 911 emergency call center totaled $449,000. Of this amount $422,000 was paid before year-end. 4. During the year the state government awarded Newport City a grantto reimburse the city's cost ( not to exceed $150,000) for the pupose of training new 911 operators. During the year, the city paid $146,500 ( not relfected inthe expenditures above) to trian new operators for the 911 emergancy call center and billed the state government.…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
