Advanced Accounting
14th Edition
ISBN: 9781260247824
Author: Joe Ben Hoyle, Thomas F. Schaefer, Timothy S. Doupnik
Publisher: RENT MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 18, Problem 42P
To determine
Determine the given statement is true or false with a brief explanation.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Southeastern College began the year with endowment investments of $1,200,000 and $700,000 of restricted cash designated by a
donor for capital additions.
1. During the year an additional $950,000 donation was received for capital additions. These funds together with those contributed in
the prior year were used to purchase 150 acres of land adjacent to the university.
2. An alum contributed $200,000 to the permanent endowment and pledged to provide an additional $400,000 early next year. The
cash was immediately invested.
3. By terms of the endowment agreement, interest and dividends received on the investments are restricted for scholarships. Gains or
losses from changes in the fair value of the investments, however, are not distributed but remain in the endowment. During the year
$48,000 of interest and dividend were received on endowment investments.
4. At year-end, the fair value of the investments had increased by $8,500.
Required:
Prepare journal entries to record the above…
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
Southeastern College began the year with endowment investments of $1,530,000 and $900,000 of restricted cash designated by a donor for capital additions.
1. During the year an additional $532,000 donation was received for capital additions. These funds together with those contributed in the prior year were used to purchase 150 acres of land
adjacent to the university.
2. An alum contributed $400,000 to the permanent endowment and pledged to provide an additional $620,000 early next year. The cash was immediately invested.
3. By terms of the endowment agreement, interest and dividends received on the investments are restricted for scholarships. Gains or losses from changes in the fair value of the investments,
however, are not distributed but remain in the endowment. During the year $70,000 of interest and dividend were received on endowment investments.
4. At year-end, the fair value of the investments had increased by $10,100.
Required:
Prepare journal entries to record the above…
Knowledge Booster
Similar questions
- Southeastern College began the year with endowment investments of $1,430,000 and $850,000 of restricted cash designated by a donor for capital additions. 1. During the year an additional $522,000 donation was received for capital additions. These funds together with those contributed in the prior year were used to purchase 150 acres of land adjacent to the university. 2. An alum contributed $350,000 to the permanent endowment and pledged to provide an additional $570,000 early next year. The cash was immediately invested. 3. By terms of the endowment agreement, interest and dividends received on the investments are restricted for scholarships. Gains or losses from changes in the fair value of the investments, however, are not distributed but remain in the endowment. During the year $65,000 of interest and dividend were received on endowment investments. 4. At year-end, the fair value of the investments had increased by $9,100. Required: Prepare journal entries to record the above…arrow_forward! Required information Problem 18-45 (Static) (LO 18-1, 18-2, 18-4, 18-5, 18-8) [The following information applies to the questions displayed below.] For a number of years, a private not-for-profit entity has been preparing financial statements that do not necessarily conform to U.S. generally accepted accounting principles. At the end of the most recent year (Year 2), those financial statements show total assets of $900,000, total liabilities of $100,000, net assets without donor restriction of $400,000, and net assets with donor restrictions of $400,000. This last category is composed of $300,000 in net assets with purpose restrictions and $100,000 in net assets that must be permanently held. At the end of Year 1, financial statements show total assets of $700,000, total liabilities of $60,000, net assets without donor restriction of $340,000, and net assets with donor restrictions of $300,000. This last category is composed of $220,000 in net assets with purpose restrictions and…arrow_forward2 Southeastern College began the year with endowment investments of $1,450,000 and $860,000 of restricted cash designated by a donor for capital additions. During the year, an additional $524,000 ddonation was received for capital additions. These funds, together with those contributed in the prior year, were used to purchase 150 acres of land adjacent to the university. An alum contributed $360,000 to the permanent endowment and pledged to provide an additional $580,000 early next year. The cash was immediately invested. By terms of the endowment agreement, interest and dividends received on the investments are restricted for scholarships. Gains or losses from changes in the fair value of the investments, however, are not distributed but remain in the endowment. During the year, $66,000 of interest and dividends were received on endowment investments. At year-end, the fair value of the investments had increased by $9,300. Required: Prepare journal entries to record the above…arrow_forward
- Catherine College, a private not-for-profit college, received the following contributions during 2017: I. P5,000,000 from alumni for construction of a new wing on the science building to be constructed in 2018. II. P 1,000,000 from a donor who stipulated that the contribution be invested indefinitely and that the earnings be used for scholarships. As of December 31, 2017, earnings from Investments amounted to P50,000. Page 13 For the year ended December 31, 2017, what amount of these contributions should be reported as temporarily restricted revenues on the statement of activities? P 50,000 b. P 5,050,000 c. P5,000,000 d. P6,050,000 a.arrow_forwardPlease help mearrow_forwardMaintenance money for a new building at a college is being solicited frompotential alumni donors. You would like to make a donation to cover all future expected maintenance costs for the building. These maintenance costs are expected to be $40,000 each year for the first five years, $50,000 for each of years 6 through 10, and $60,000 each year after that. (The building has an indefinite service life.)(a) If the money is placed in an account that will pay 13% interest compounded annually, how large should the gift be?(b) What is the equivalent annual maintenance cost over the infinite servicelife?arrow_forward
- Irrespective of how capital assets are acquired, they are recorded differently in governmental funds than in businesses. In a recent year, Ives Township acquired six police cars at a total cost of $200,000. The vehicles are expected to have a useful life of four years. Prepare the journal entries that the township would make in its general fund in the year of acquisition for each of the following assumptions: It paid for the cars in cash at the time of acquisition. It leased the cars and agreed to make, starting in the year of acquisition, four equal payments of $63,095, an amount that represents the annuity required to liquidate a loan of $200,000 at 10 percent interest. The lease would satisfy the criteria necessary to be accounted for as a capital lease. It issued $200,000 in installment notes to the car dealer, agreeing to repay them in four annual payments of $63,095, starting in the year of acquisition. 2. Comment on how any “off the balance sheet” assets or obligations…arrow_forwardScofield City received a donation from the estate of the late Lisa O’Reilly to be used to support the city’s public library. The gift consisted of $200,000 cash and a portfolio of securities with a market value of $350,000. The securities have a book value of $250,000. The donor stipulated that the principal of the gift, including investment gains (realized and unrealized) but excluding investment losses, must be kept intact. The income must be used to care for and maintain the book collection at the newly renamed O’Reilly Public Library. All appropriate costs, including investment losses, may be charged against the revenues yearly to determine the amount available for the specified purposes. During the year, the city engaged in the following transactions on behalf of the library. Prepare the appropriate entries in the city’s permanent fund. a) Accepted the donation. b) Received dividends and interest of $18,000. c) Purchased securities for $200,000. d) Sold securities that were part…arrow_forwardThe Western Falls School District received a $ 100,000 gift from a wealthy alumnus , and an agreement was reached that $10,000 per year would be paid to the valedictorian of the high school class as a freshman scholarship to college , until the funds were depleted . The $ 100,000 would be accounted for as : OA Private - Purpose Trust Fund A custodial fund An Expendable Trust Fund An investment trust fundarrow_forward
- On January 1, 2021, Fantastic Corporation received cash of P8,000,000 from a local government to be used in constructing a building. The construction was completed on December 31, 2021 for a total cost of P20,000,000. The building will be depreciated using the straight-line method for 20 years. Refer to Fantastic, calculate the value of income from government grant to be reported on December 31, 2021 using gross presentation. Select one: а. 400,000 b. 600,000 с. 1,000,000 d. 8,000,000 e. None of the choicesarrow_forwardThe following events occurred as part of the operations of Craig State University, a public university:1. To construct a new computer complex, the university floated at par a $22,000,000, 7% serial bond issue on October 1, paying interest on June 30 and December 31. Accrued interest is to be transferred to the retirement of indebtedness plant fund when construction begins. Construction costs are to be accumulated in the unexpended plant fund until the unit is completed.2. Since construction has begun, the accrued interest, which must be used to assist in meeting bond interest payments, is transferred. Payments for construction to date total $5,000,000.3. On December 31, a mandatory transfer of $385,000 is made from the unrestricted current fund to cover the remainder of the interest due on December 31 on the bond issue.4. The bond interest due on December 31 is paid.5. Construction of the complex is completed at an additional cost of $17,000,000. Payment is made for $16,000,000; the…arrow_forwardThe following events take place: 1. 2. 3. Edward Lewis died and left 100 acres of undeveloped land to the city for a future park. He acquired the land at $100 an acre, but at the date of his death, the land was appraised at $7,300 an acre. The city authorized the transfer of $100,000 of general revenues and the issuance of $970,000 in general obligation bonds to construct improvements on the donated land. The bonds were sold at par. The improvements were completed at a cost of $1,070,000, and the operation of the park was turned over to the City Parks Department. Prepare entries in general journal form to record these transactions in the proper fund(s). Designate the fund in which each transaction is recorded. If the transaction did not result in a journal entry to a government fund, record the journal entry needed to reflect the information in the government-wide Statement of Net Position. (Credit account titles are automatically indented when amount is entered. Do not indent…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
