Would someone happen to know why the answer is $1,900,000 and not $1,800,000? I don't know if I'm just missing a keyword somewhere. Shouldn't the availability make it so the 10% allowance is applied and not the 5%?
Halderman County levies an imposed nonexchange form of tax in the year prior to the year of its intended collection and use. An enforceable legal claim does not arise until the period after the period of its intended collection and use. The following facts apply:
On September 1, 20X1, the county levied $2 million of tax for FY 20X2—50% of the tax is due on January 15, 20X2, and the remainder is due July 15, 20X2.
It is estimated 5% of the levy will be uncollectible.
An enforceable legal claim for the September 1, 20X1, levy does not attach until January 15, 20X3.
It is estimated 90% of the September 1, 20X1, levy will be collected during the period January 1, 20X2, through February 28, 20X3. The balance will be collected at a later date, or go uncollected.
The County uses an “availability period†equal to two months following the close of the fiscal year, and has a fiscal year-end of December 31.
How much revenue would be recognized at the entity-wide level for FY 20X2?
A. $1,500,000
B. $1,800,000
C. $1,900,000
D. $2,000,000
Thank you! Any help with this is much appreciated
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