Neco 2017 Financial Accounting Question 5

A local government budgets the following for the year: Tax revenue based on a 10 % rate on an assessable base of ₦1,200,000; non‑tax revenue ₦30,000; grants received ₦20,000; and total expenditures ₦150,000 (salaries ₦70,000, maintenance ₦40,000, interest ₦10,000, other ₦30,000). During the year, the tax rate is increased to 12 % for the second half of the year, while the assessable base remains unchanged. Non‑tax revenue exceeds the budget by 10 %. An unexpected emergency expenditure of ₦12,000 occurs, and maintenance costs rise by 5 % of the original maintenance budget. After settling all items, the council decides to transfer 5 % of any surplus to a development fund. Calculate the amount transferred to the development fund at year‑end.