A City Levies a 2 Percent Sales Tax That Is

question 46

Multiple Choice

A city levies a 2 percent sales tax that is collected for them by the state. Sales taxes must be remitted by the merchants to the state by the 20^th day of the month following the month in which the sale occurred. The state has a policy of remitting sales taxes to the city within 30 days of collection by the state. Cash received by the state related to sales taxes is as follows: Assuming the city uses the same period to define "available" as the maximum period allowable for property taxes, what amount should it recognize as sales tax revenue in its governmental fund financial statements for the fiscal year ended 12/31/17?

• A) $430.
• B) $530.
• C) $540.
• D) $550.

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Definitions:

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