Record the following journal entries: a. the county levies property taxes for th

Question

Record the following journal entries:                                                                                                                                 a. the county levies property taxes for the city ($2,000,000) and local schools ($3,000,000) and $1,000,000 for the county itself                                                                                                                                                            b.  The county collects the property taxes                                                                                                                        c.  The county distributes the property taxes collected

Explanation / Answer

Agency funds are purely custodial in nature which is why the fund wouldn't have revenue or expenses. The fund balance sheets show only assets (such as cash and investment) and liabilities (which is the amounts owned to the beneficiaries). Assets always equal liabilities which is why there are no net assets

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