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:

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 Assigned to Library for any spendable fund balance).

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Debits Credits Trial Balance-December 31, 2020 Cash $ 7,500 Investments 630,000 Additions to permanent endowments $625,000 Investment income 48,000 Expenditures-subscriptions 39,500 Net increase in fair value of investments 5,000 Accrued interest receivable 2,000 Accounts payable 1,000 $679,000 $679,000