The Tax Rate Is Not Determined Until October 10, and the Tax

question 33

Essay

The tax rate is not determined until October 10, and the tax bills are mailed October 20 with payment due by December 31. For the prior fiscal year, the Radar Company paid $18,000. The tax bill for the current fiscal year July 1, 2016-June 30, 2017) is received on October 23, and property taxes have increased to $18,900. The company pays this amount on October 29.
Required:
a. Record the monthly property tax accrual recorded in July of 2014.
b. Record the payment of the taxes on October 29.
c. Record the monthly adjusting entry on October 31.

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Definitions:

Cost Curve

A graphical representation that shows the costs of production as a function of the total quantity produced.

Average Total Cost

The total cost of production divided by the number of goods produced; it's a method to calculate the cost per unit of production.

Average Variable Cost

The total variable costs (costs that change with production volume) divided by the quantity of output produced.

Diminishing Marginal Returns

A principle in economics where each additional unit of input results in a smaller increase in output than the previous unit, at a certain point.