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Governmental accounting: Revenue recognition

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The recognition of revenue from fines does not necessarily reflect
the amount earned by merely issuing tickets.
In August 2008, the last month of its fiscal year,
GoldwaitheTownship issued $88,000 worth of tickets for
parking and traffic violations. Of these, the township collected
$45,000. It expects to collect an additional $20,000
within sixty days of the close of the fiscal year and to collect
$3,000 subsequent to that. It will have to write off the
balance. The tickets are due; the protest period expires on
September 15.

1. How much revenue should the township recognize from
the tickets issued in August 2008? Explain.

2. How might your answer change with respect to the
township's government-wide statements?

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1. The township should recognize 65,000(=45,000+20,000) revenue from tickets issued in fiscal 2008, because under the modified accrual accounting, revenue is ...

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