Reference no: EM133143498
Question - The Evangelical Private School follows FASB standards of accounting and reporting.
Cash contributions were received as follows: (a) $976,000 for any purpose desired by the school, (b) $306,000 designated by donors for salary supplements for school faculty, (c) $421,000 designated by donors to be used during the next fiscal year in any manner desired by the school, (d) $563,000 designated by donors for the construction of a new auditorium, and (e) $416,000 designated by donors to be invested permanently, with the income to be used as desired by the school. The school's policy is to record all restricted gifts as with donor restrictions and then reclassify when the restriction is lifted.
The school expended $360,000 of the $976,000 mentioned in 1(a) for school furniture.
The school expended the $285,400 for salary supplements as directed by the donor in 1(b).
The $421,000 in 1(c) was retained for use next year, as directed by the donor.
$743,000 was expended for the construction of the new auditorium.
The $416,000 mentioned in 1(e) was invested permanently, as directed by the donor, and in the year ended June 30, 2020, the school received interest of $19,760, none of which was expended.
Record journal entries for the above transactions during the year ended June 30, 2020. (If no entry is required for a transaction/event,write "No Journal Entry Required"
Record the entry for cash contributions received without donor restrictions.
Record the entry for designated cash contributions by donors for salary supplements for school faculty
Record the entry for designated cash contributions by donors to be used during the next fiscal year in any manner desired by the school.
Record the entry for designated cash contributions by donors for the construction of a new auditorium
Record the entry for cash contributions to be invested permanently, as directed by the donor.
Record the entry for cash purchase of school furniture.
Record the entry for payment of salary.
Record the entry for reclassification of net assets as the salary payment was made to the school faculty.
Record $421,000 that will be reclassified at the beginning of next year as the expiration of time restrictions.
Record $743,000 that was expended for the construction of the new auditorium.
Record the entry for reclassification of net assets as the new auditorium is constructed.
Record the entry for cash paid for investments
Record the entry for receipt of interest income.