Issue 1 (Fines, Interest, and Tax Deductions) Situation A Interest and penalties are assessed for late payment. 1. On January 1, a country collects property taxes for the year $ 11,000,000; $ 110,000 of property tax is expected to be uncollectible. 2. Before the due date, the county collects $ 8,000,000 in taxes. Flowers and 3. 10 percent penalty assessed for tax that is not collectible on the due date; 5 percent interest and penalties are not expected to be collectible. 4. The government removes $ 100,000 from problem tax and $ 10,000 from interest and penalties for uncollectible accounts. 5. The remaining receivables are collected at the end of the year. Situation B A deduction is awarded for timely payment. 1. On January 1, a city collects property taxes for the year $ 11,000,000; $ 110,000 of property tax is estimated to be uncollectible. Also, property owners who pay on or before the due date receive a one-eleven discount on their tax bill. It is expected that 80 percent of the tax will be collected by the due date. 2. Taxes receivable of $ 8,800,000 were collected by the city on or before the due date. The tax balance is declared in arrears. 3. The government removes $ 110,000 from the arrears tax as uncollectible. 4. The remainder of the tax is collected at the end of the year. (a) Prepare journal entries to record transactions for each of the preceding situations. (B) Calculate the amount of revenue to be reported for the year for each situation.