Choice "D" is correct. Revenues are recognized when measurable and available. In the case of property taxes, receivables are recognized in the period in which the taxes are levied. When property taxes are either recognized as receivable in advance or collected in advance of the year in which they are levied, deferred inflows of resources are recorded.I.
| Debit (Dr) | Credit (Cr) |
|---|
| Property taxes receivable | $ XXX | |
| Deferred inflows of resources | | $ XXX |
II.
| Debit (Dr) | Credit (Cr) |
|---|
| Cash | $ XXX | |
| Deferred inflows of resources | | $ XXX |
Note: Some individuals may elect to pay their property taxes in installments. In order to accomplish this, taxes must be estimated and billed and collected in advance of the levy.Choices "b", "c", and "a" are incorrect per journal entry explanation above.
