A Governmental Entity Has Formally Integrated the Budget into Its

question 45

Multiple Choice

A governmental entity has formally integrated the budget into its accounting records. At year-end the ledger account "Estimated Revenues" has a debit balance. Which of the following is the best explanation for the debit balance?

• A) The entity overestimated property tax revenue it expected to be recognized.
• B) The entity underestimated property tax revenue when preparing its budget.
• C) The entity collected more in property taxes than it anticipated.
• D) There is no logical explanation; revenue accounts usually do not have debit balances.

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