The voters of the city passed an ordinance to increase their sales tax by ¼ percent. The proceeds of the sales tax are to be used for culture and recreation. In the governmental activities journal, how would the ¼ percent sales tax revenue be recorded?

Question

Nigel Diaz

Mathematics

16 December, 11:33

The voters of the city passed an ordinance to increase their sales tax by ¼ percent. The proceeds of the sales tax are to be used for culture and recreation. In the governmental activities journal, how would the ¼ percent sales tax revenue be recorded?

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Answers (2)

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Emmett Small · Answer 1

General Revenue Sales Tax

Step-by-step explanation:

The ¼ percent would be recorded as general revenue sales tax in government activities journal.

This is because the revenue from the tax are categorised as the revenues generated from payrolls (which are imposed on employers), income and profits taxes, social security contributions, taxes levied on goods and services.

Teagan Huffman · Answer 2

Options:

Program Revenue-Culture and Recreation-Sales Tax.

Program Revenue-Culture and Recreation-Operating Grants and Contributions.

General Revenue-Sales Tax.

General Revenue-Culture and Recreation-Sales Tax.

Answer:

General Revenue - Sales Tax

Step-by-step explanation:

General revenue is the income that is generated by the state which may be used to serve any administrative purpose by the state, and tax revenue is the income that is generated by the state through taxation.

Since the sales tax is a way of generating income by the state, it should be recorded as sales tax under general revenue.