Question
1.) If a donor endows a professorial chair at a school, he or she gives a gift and indicates that the earnings from the gift
1.) If a donor endows a professorial chair at a school, he or she gives a gift and indicates that the earnings from the gift must be used by a specific professor. Would the initial gift be recorded in a fund with donor restrictions or a fund without donor restrictions? Would the earnings be recorded in a fund with donor restrictions or a fund without donor restrictions?
2.) A board sets aside resources to earn investment income to support general operations. Would the resources set aside be recorded in a fund with donor restrictions or a fund without donor restrictions? Would the earnings be recorded in a fund with donor restrictions or a fund without donor restrictions?
3.)The Abby Arboretum (AA) is a not-for-profit organization that has several programs, including gardening, grade-school education, environmental efforts, and a reforestation program. It draws many volunteers for its efforts. Indicate which, if any, of the following activities should be recorded as donated services.
An architect drew up blueprints for a new greenhouse free of charge. AA would have hired an architect otherwise.
The architect makes phone calls to past clients and investors to raise contributions on behalf of AA for a capital campaign to finance the greenhouse.
After the greenhouse is built, the architect spends several days planting vegetables and flowers.
4.) Indicate whether each of the following actions would result in a change in net assets without donor restrictions or net assets with donor restrictions this year:
A donor gives the organization a cash contribution to be used for expanding the organizations food pantry program.
The organization earns an unrealized gain on its permanent endowment. A donor pledges money to the organization but has not paid it yet.
The donor does not indicate how the money is to be used.
The organization sells goods from its online bookstore.
A donor gives the organization cash and specifies that the money is to be used in 4 years.
A donor gives 1,000 shares of Apple stock and stipulates the proceeds of the stock are not to be spent but held in perpetuity.
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