All facts about this NFPO are identical to those described in Problem 11, except that the deferral method of recording contributions is used for accounting and for external financial reporting. Fund accounting is not used. The Year 6 transactions are also identical to those described in Problem 11. 

The organization's statement of financial position on January 1, Year 6, is shown below.

Required:

(a) Prepare the journal entries necessary to reflect the Year 6 events. 

(b) Prepare a Year 6 statement of financial position, a statement of revenues and expenses, and a statement of changes in net assets for the year. 

(c) Prepare closing entries.

(d) What are fundraising costs as a percent of total revenues for Year 6? What do you think donors to the Centre will think of this percentage?

Transcribed Image Text:

FAR NORTH CENTRE STATEMENT OF FINANCIAL POSITION January 1, Year 6 Current Assets $ 838,300 700,000 Cash Pledges receivable Allowance for uncollectible pledges (44,500) 416,500 1,910,300 Grants receivable 378,000 Investments Capital assets: Land and buildings Furniture and equipment Accumulated depreciation 908,000 500,000 (668,500) 739,500 $3,027,800 Current Liabilities $ 496,400 Accounts payable Wages payable 137,500 16,100 Accrued liabilities 650,000 Deferred Revenue Deferred revenues 758,000 Deferred contributions related to capital assets 724,400 1,482,400 Net Assets Net assets restricted for endowment purposes 415,800 Unrestricted net assets 479,600 895,400 $3,027,800