A citizen group raised funds to establish an endowment for the Eastville City Library. Under the terms of the trust agreement, the principal must be maintained, but the earnings of the fund are to be used to purchase database and periodical subscriptions for the library. A preclosing trial balance of the library permanent fund follows: Trial Balance-December 31, 2024 Cash Investments Additions to permanent endowments Investment income Expenditures-Library Net increase in fair value of investments Accrued interest receivable Accounts payable Debits $7,500 631,000 36,700 1,000 Credits $625,000 42,500 6,000 2,700 $676,200 $676,200 Required: a. Prepare any closing entries necessary at year-end. b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the library permanent fund. c. Prepare a balance sheet for the Library Permanent Fund (Use Restricted to Library for any spendable fund balance).

A citizen group raised funds to establish an endowment for the Eastville City Library. Under the terms of the trust agreement, the principal must be maintained, but the earnings of the fund are to be used to purchase database and periodical subscriptions for the library. A preclosing trial balance of the library permanent fund follows: Trial Balance-December 31, 2024 Cash Investments Additions to permanent endowments Investment income Expenditures-Library Net increase in fair value of investments Accrued interest receivable Accounts payable Debits $7,500 631,000 36,700 1,000 Credits $625,000 42,500 6,000 2,700 $676,200 $676,200 Required: a. Prepare any closing entries necessary at year-end. b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the library permanent fund. c. Prepare a balance sheet for the Library Permanent Fund (Use Restricted to Library for any spendable fund balance).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

A citizen group raised funds to establish an endowment for the Eastville City Library. Under the terms of
the trust agreement, the principal must be maintained, but the earnings of the fund are to be used to
purchase database and periodical subscriptions for the library. A preclosing trial balance of the library
permanent fund follows:
Trial Balance-December 31, 2024
Cash
Investments
Additions to permanent endowments
Investment income
Expenditures-Library
Net increase in fair value of investments
Accrued interest receivable
Accounts payable
Debits
$7,500
631,000
36,700
1,000
Credits
$625,000
42,500
6,000
2,700
$676,200 $676,200
Required:
a. Prepare any closing entries necessary at year-end.
b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the library
permanent fund.
c. Prepare a balance sheet for the Library Permanent Fund (Use Restricted to Library for any spendable
fund balance).

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