The following transactions pertain to the March 31 2013 year
The following transactions pertain to the March 31, 2013, year end, for a province reporting in accordance with the CICA PSA Handbook:
1. Assume the accrual for the year-end estimate of income tax revenue has already been recorded. Since the accrual was recorded, tax officials have learned the reduction in tuitions implemented by the government in September 2012 has given rise to increased enrolment in the fall semester. Claims for the tuition tax credit are expected to increase by $10 million. The tuition tax credit can only be used to reduce income taxes payable by either the student or a relative.
2. On March 31, 2013, a $50-million loan at an interest rate of 4% was given to a school board to build a new school.
On the same date, the Ministry of Education executed a funding agreement starting April 1, 2013, with the school board. Under the funding agreement, the school board will receive a special grant equal to the interest and principal repayment due during the term of the loan.
3. A new program providing a refund of $1,000 payable to any individual who installs a solar panel on their roof is introduced during the year. The refund is paid by the Ministry of Revenue when individuals file an income tax return, and is paid whether or not the individual has taxable income. Based on sales reported by retailers, officials of the Ministry of Revenue estimate the program will cost $10 million in the fiscal year ending March 31, 2013.
Prepare the journal entries to record the above transactions.
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