(a)
Introduction:
The journal entries for the transactions in 20X2.
(a)
Answer to Problem 19.6E
Journal Entries
S.no | Date | Particulars | Debit (in $) | Credit (in$) |
1 | Pledges receivable | 700,000 | ||
Allowance for uncollectible pledges | 56,000 | |||
Unrestricted contributions | 506,000 | |||
Temporarily restricted contributions | 138,000 | |||
2 | Grants receivable | 150,000 | ||
Temporarily restricted contributions | 150,000 | |||
3 | Cash- unrestricted | 520,000 | ||
Pledges receivable | 520,000 | |||
Allowance for uncollectible pledges | 44,000 | |||
Pledges receivable | 30,000 | |||
Unrestricted contributions | 14,000 | |||
4 | Land, buildings and equipment | 15,000 | ||
Unrestricted cash | 15,000 | |||
5 | Mortgages payable | 3,000 | ||
Unrestricted cash | 3,000 | |||
6 | Cash- unrestricted | 27,200 | ||
Cash- temporarily restricted | 5,400 | |||
Investment income- unrestricted | 27,200 | |||
Investment income- temporarily restricted | 5,400 | |||
Cash- permanently restricted | 6,000 | |||
Endowment investments | 5,000 | |||
Gain on sale of investment- permanently restricted | 1,000 | |||
7 | Community service expense | 12,000 | ||
Public health education expenses | 7,000 | |||
Research expenses | 10,000 | |||
Fund raising expenses | 15,000 | |||
General and administrative expenses | 9,000 | |||
| 53,000 | |||
8 | Community service expense | 250,600 | ||
Public health education expenses | 100,000 | |||
Research expenses | 81,000 | |||
Fund raising expenses | 39,000 | |||
General and administrative expenses | 61,000 | |||
Cash- unrestricted | 531,600 | |||
9 | Fund raising expense | 2,400 | ||
Donated services | 2,400 |
Explanation of Solution
- Recording the patients services provided
- Recording operating expenses against credit for expenses
- Recording contractual adjustments against revenues
- Recording the transfer from specific purpose funds
- Recording funds received from equipment acquisition
- Recording receipt of unrestricted gifts
- Recording collection from account receivables
- Recording the increase in fair market value of securities.
(b)
Introduction: The statement of activities is the financial statement of a non- profit organization or otherwise. The statement of activities has multiple columns for reporting the amounts for the following net assets:
- Without donor restriction funds
- With donor restriction funds
- The aggregate amount
The statement of activities for the financial year ended 20X2
(b)
Answer to Problem 19.6E
The net assets at the end of the year as per statement of activities is $846,400.
Explanation of Solution
Statement of activities for the year ended 31 December, 20X2
Particulars | Unrestricted | Temporarily restricted | Permanently restricted | Total |
Revenues, gains and other supports: | ||||
Contributions, net of estimated uncollectible pledges | 520,000 | 138,000 | 658,000 | |
Grants | 150,000 | 150,000 | ||
Investment income | 27,200 | 5,400 | 32,600 | |
Gain on investments | 1,000 | 1.000 | ||
Donated services | 2,400 | 2,400 | ||
Total gains, revenues and other support | 549,600 | 293,400 | 1,000 | 844,000 |
Programs services and support: | ||||
Program services: | ||||
Community services | 262,600 | 262,600 | ||
Public health education | 107,000 | 107,000 | ||
Research | 91,000 | 91,000 | ||
Total program services | 460,600 | 460,600 | ||
Supporting services: | ||||
General and administrative | 70,000 | 70,000 | ||
Fund raising | 54,000 | 54,000 | ||
Total supporting services | 124,000 | 124,000 | ||
Total expenses | 584,600 | 584,600 | ||
Change in net assets | (35,000) | 293,400 | 1,000 | 259,400 |
Net assets at the beginning of the year | 281,000 | 87,000 | 219,000 | 587,000 |
Net assets at the end of the year | 246,000 | 380,400 | 220,000 | 846,400 |
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Chapter 19 Solutions
Advanced Financial Accounting
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