Please prepare dummy journal entries. Assume instead that Good Charity prepares its annual financial statements using the restricted fund method of accounting for contributions and has chosen to have a general, capital and endowment fund to account for its activities. Jan 1: a donor contributes land for a future operations site. Land has a fair value of $32,000. 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. 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 purchase $100,000 of equipment and furniture on July 1, 2020 and the operation opened in a rented facility on July 2, 2020. e) Costs of $72,000 were incurred during 2020 of which $48,000 were paid. Prepare the following statements for Good Charity based on the above: i) The statement of operations for the year ended December 31, 2020. ii) The statement of financial position at December 31, 2020.
Please prepare dummy journal entries. Assume instead that Good Charity prepares its annual financial statements using the restricted fund method of accounting for contributions and has chosen to have a general, capital and endowment fund to account for its activities. Jan 1: a donor contributes land for a future operations site. Land has a fair value of $32,000. 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. 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 purchase $100,000 of equipment and furniture on July 1, 2020 and the operation opened in a rented facility on July 2, 2020. e) Costs of $72,000 were incurred during 2020 of which $48,000 were paid. Prepare the following statements for Good Charity based on the above: i) The statement of operations for the year ended December 31, 2020. ii) The statement of financial position at December 31, 2020.
Chapter28: Income Taxation Of Trusts And Estates
Section: Chapter Questions
Problem 9DQ
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Please prepare dummy
- Assume instead that Good Charity prepares its annual financial statements using the restricted fund method of accounting for contributions and has chosen to have a general, capital and endowment fund to account for its activities.
- Jan 1: a donor contributes land for a future operations site. Land has a fair value of $32,000.
- 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.
- 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 purchase $100,000 of equipment and furniture on July 1, 2020 and the operation opened in a rented facility on July 2, 2020.
e) Costs of $72,000 were incurred during 2020 of which $48,000 were paid.
Prepare the following statements for Good Charity based on the above:
i) The statement of operations for the year ended December 31, 2020.
ii) The statement of financial position at December 31, 2020.
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