Community Assist for Refugees (CAR) is a not-for-profit organization that assists refugees with various services including language and cultural training, transportation, a food bank, and translation services. Some selected transactions for CAR are presented below. a. CAR received a $20,000 cheque from a local radio station. The letter that came wit hthe donation says that it can be used by CAR on whatever needs are most urgent. b. CAR received a $25,000 donation from the Literacy Fund for a new homework ambiance piglet the project serpested o star /in a ew moning,.( C. CAR received a $55,000 endowment contribution from Dr. Koe for a scholarship d. CAR received a donation of 50 student desks for its homework assistance project from City Office Supplies Ltd. The student desks are valued at $40,000 and are expected to last 10 years. e. The city donated a tract of land, valued at $50,000 to CAR which plans to raise funds to constract a new center on the land. f. Assume that the homework as istance project is underway. The $25,000 in part b. has been spent on 8- Assume that at the end of the year, the endowment contribution in part c. earned $750 in interest. Dr. Koe had specified that the interest must be spent on future scholarships. CAR will wait until there ist at least $2,500 in accumulated interest before distributing any scholarships. h. At the end of the year, CAR records depreciation on the student desks using the straight-line method. Required: Prepare the journal entries to record the above transactions on CAR's books using a. the deferral method, and b. the restricted fund method.
Community Assist for Refugees (CAR) is a not-for-profit organization that assists
refugees with various services including language and cultural training, transportation,
a food bank, and translation services. Some selected transactions for CAR are
presented below.
a.
CAR received a $20,000 cheque from a local radio station. The letter that came wit
hthe donation says that it can be used by CAR on whatever needs are most urgent.
b.
CAR received a $25,000 donation from the Literacy Fund for a new homework
ambiance piglet the project serpested o star /in a ew moning,.(
C.
CAR received a $55,000 endowment contribution from Dr. Koe for a scholarship
d. CAR received a donation of 50 student desks for its homework assistance project
from City Office Supplies Ltd. The student desks are valued at $40,000 and are
expected to last 10 years.
e. The city donated a tract of land,
valued at $50,000 to CAR which plans to raise funds to constract a new center on the land.
f.
Assume that the homework as istance project is underway. The $25,000 in part b.
has been spent on
8-
Assume that at the end of the year, the endowment contribution in part c. earned
$750 in interest. Dr. Koe had specified that the interest must be spent on future
scholarships. CAR will wait until there ist at least $2,500 in accumulated interest
before distributing any scholarships.
h. At the end of the year, CAR records
straight-line method.
Required:
Prepare the
a. the deferral method, and
b. the restricted fund method.
Step by step
Solved in 3 steps with 2 images
