Accounting for Contribution Revenue Hannon University, a private, nonprofit university, receives a letter from an alumnus who pledges $4,400,000 for the establishment of a center for public service. The donor expresses the wish that the amount be used in th next fiscal year, but the donor's letter does not identify any barriers to be overcome or identify a right of release. Based on history, Hannon University expects to collect 95% of the pledged amount. 1. Record the journal entry that would be recorded upon receipt of the letter. Enter accounts in order of magnitude (largest to smallest amounts), debits first. Account Debit To record the pledge from an alumnus. 0 0 0 Credit Revenue would have been recorded for the full pledge amount. The pledge would not have been recorded. The revenue would not have been recorded as restricted. 0 0 0 2. How would the pledge have been recorded if Hannon University were a public university?

Accounting for Contribution Revenue Hannon University, a private, nonprofit university, receives a letter from an alumnus who pledges $4,400,000 for the establishment of a center for public service. The donor expresses the wish that the amount be used in th next fiscal year, but the donor's letter does not identify any barriers to be overcome or identify a right of release. Based on history, Hannon University expects to collect 95% of the pledged amount. 1. Record the journal entry that would be recorded upon receipt of the letter. Enter accounts in order of magnitude (largest to smallest amounts), debits first. Account Debit To record the pledge from an alumnus. 0 0 0 Credit Revenue would have been recorded for the full pledge amount. The pledge would not have been recorded. The revenue would not have been recorded as restricted. 0 0 0 2. How would the pledge have been recorded if Hannon University were a public university?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter15: Exempt Entities

Section: Chapter Questions

Problem 20P

See similar textbooks

Similar questions

During the year, Private College received the following: An unrestricted $10,000 pledge to be paid the following year. A $70,000 cash gift restricted for scholarships. A notice from a recent graduate that the college is named as a beneficiary of $25,000 in that graduate's will. What amount of contribution revenue should Private College report in its statement of activities? A.) $10,000 B.) $70,000 C.) $105,000 D.) $80,000
1. A donor contributed $100,000 in cash to Goodwill Industries in 2020. The donor specified that the contribution be held as a permanent endowment, and income from investment of the contribution be used for job training programs. Goodwill Industries invested the $100,000 in securities in 2020. During 2021, investment income of $3,000 was received in cash, and $2,500 was used for job training programs. How does Goodwill Industries report this on its 2021 statement of activities? Select one: A. $3,000 investment income increases net assets without donor restrictions; $2,500 expense decreases net assets without donor restrictions. B. $3,000 investment income increases net assets with donor restrictions; $2,500 net assets released from use restrictions decreases net assets with donor restrictions and increases net assets without donor restrictions; $2,500 expense reduces net assets without donor restrictions. C. $3,000 investment income increases net assets without donor restrictions;…
Record journal entries for the following transactions for Sultan Private School during the year ended July 31, 2020. Cash contributions were received as follows: AED792,000 for any purpose desired by the school AED233,000 for salary supplements for school faculty AED458,000 to be used during the next fiscal year in any manner desired by the school AED576,000 for the construction of a new auditorium and AED300,000 to be invested permanently, with the income to be used as desired by the school . The school policy is to record all restricted gifts as temporarily restricted and then reclassify when the restriction is lifted. The school expended AED338,000 of the AED792,000 mentioned in (1a) for school furniture. The school expended AED124,000 for salary supplements as directed by the donor in (1b). The AED458,000 in (1c) was retained for use next year, as directed by the donor. AED689,000 was expended for the construction of the new auditorium. The AED300,000 mentioned in (1e) was…
Record the following events that affect (1) Public University and (2) Private University: a. A private grant of $200,000 was received to be used exclusively for defraying costs of holding conferences on the topic of genes. b. By year-end, $110,000 of the grant mentioned in item (a) had been applied to the purpose stipulated. c. The grant provided that amounts not awarded by year-end are to be transferred to the endowment fund. The liability to that fund is recorded. d. An alumnus, who was a former athlete, contributed $15,000 to assist in the search for a basketball coach.
Recording journal entries for nonprofits 6. Donor D advises a university that he has established an irrevocable charitable remainder trust, administered by his attorney, whereby his wife will receive income from the trust as long as she lives. At her death, the remaining trust assets will be distributed to the university as a permanent endowment. The university’s actuary estimates the fair value of the university’s beneficial interest to be $400,000 (answer question 6 - what should be the correct entry?)
You are preparing a statement of activities for the University of Richland, a private not-for-profit entity. The following questions should be viewed as independent of each other.Part 1During the current year, a donor gives $400,000 in cash to the school and stipulates that it must hold this money forever. However, any investment income earned on this money must be used for faculty salaries. During the current year, the investment earned $31,000 and, of that amount, the school has expended $22,000 appropriately to date. As a result of these events, what was the overall change in each of the following for the current year?a. Unrestricted net assets.b. Temporarily restricted net assets.c. Permanently restricted net assets.Part 2 A donor gives a large machine to the school on January 1 of the current year. It has a value of $200,000, no salvage value, and a 10-year life. The donor requires that the school keep the machine and use it for all 10 years, and the school agrees. It cannot sell…
Good Charity is a new not-for-profit organization that opened in January 2020. It is funded by government grants and private donations. It prepares its annual financial statements using the deferral method of accounting for contributions and uses only one fund to account for all activities. Required: 1) Prepare all related journal entries for the following transactions for Good Charity for 2020: a) Jan 1: a donor contributes land for a future operations site. Land has a fair value of $32,000. b) Feb 1: A donor contributes $60,000 on the condition that the principal amount be invested in marketable securities and that only the income earned from the investment be spent on operations. Income of $2,000 was earned and received during 2020 on these investments. c) General donations of $85,000 were received during 2020. d) Feb 1: the government gave $80,000 to Good Charity to purchase equipment and furniture with a useful life of 10 years. This was all used to…
The statement of financial position of Washbud Private University as of the end of its fiscal year, June 30, 2018, is as attached:The following transactions occurred during the fiscal year ended June 30, 2019 (all numbers are in 000’s):a. On July 7, 2018, a gift of $90,000 was received from an alumnus. The alumnus requested that one-half of the gift be used for the purchase of equipment for the university athletic department and the remainder be used for the establishment of a permanently restricted endowment.The alumnus further requested that the income generated by the endowment be used annually to award a scholarship to a qualified disadvantaged student. On July 20, 2018, the board of trustees resolved that the funds of the newly established endowment would be invested in savings certificates. On July 21, 2018, the savings certificates were purchased.b. Revenues from student tuition and fees applicable to the year ended June 30, 2019, amounted to $1,900,000. Of this amount, $66,000…
Prepare journal entries to record the transactions.1. Donor A gave a nonprofit a $55,000 cash gift in June, stipulating that the nonprofit could not use the gift until the next fiscal year.2. Donor B gave a nonprofit a $27,500 cash gift in July, telling the nonprofit the gift could be used only for research on a specific project.3. In response to a special fundraising campaign, whereby contributions could be used only for construction of a new warehouse, a large number of individualspromised to make cash contributions totaling $2,200,000 during the current fiscal year. The nonprofit believes it will actually collect 80 percent of the promised cash.4. Donor C gave a nonprofit several investments having a fair value of $3,300,000 in March. Donor C stipulated that the nonprofit must hold the gift in perpetuity,but it could use the income from the gift for any purpose the trustees considered appropriate. Between March and December, the investments produced income of $110,0005. Using the…