Question
1. On January 10, 2008, in response to its annual fund-raising drive to fi- nance its day-to-day operations, FSI received $152,000 of cash donations
1. On January 10, 2008, in response to its annual fund-raising drive to fi- nance its day-to-day operations, FSI received $152,000 of cash donations and $400,000 of promises to donate cash. Based on experience, FSI ex- pected to collect 80 percent of the promises to donate cash, all of which was to be used to finance its activities during 2008. 2. During the year, FSI received cash of $310,000 from the promises to give (see transaction 1) and wrote off the remaining receivables as uncollectible.. 3. FSI determined that it needed to add storage facilities at an estimated cost of $300,000 to meet its expanding operations. Dr. Ted Golfit, noted research engineer, advised FSI that he would contribute $150,000, pro- vided FSI raised an equal amount from other sources. 4. Attorneys A. and E. Gorman provided free legal services to FSI during the year. FSI would have purchased the services for $10,000 if they had not been donated. 5. FSI raised $165,000 cash as a result of its fund-raising campaign to add to its storage facilities (see transaction 3). FSI contacted Dr. Golfit, who gave FSI a check for $150,000. 6. FSI constructed additional storage facilities at a cost of $318,000. It paid for the facility by using $315,000 it had raised for that purpose (see trans- action 5) and by using $3,000 of its unrestricted available cash. 7. FSI's contract with the County Department of the Aging called for the county to make quarterly advance payments to FSI based on an esti- mate. The contract also provided for FSI to report to the county after the end of each quarter, showing actual costs to provide food to the se- nior citizens during the quarter, and billing for any difference between actual costs and the estimate. On January 5, 2008, FSI received a $20,000 advance payment from the county. 8. Between January and March 2008, FSI spent $23,000 cash providing ser- vices on its contract with the county (see transaction 7). On April 4, 2008, FSI sent an invoice to the county, showing it had spent $23,000 on the pro- gram, deducting the $20,000 advance, and requesting an additional $3,000. 9. During 2008, FSI received donations of 1.2 million pounds of food from supermarkets, bakeries, and food wholesalers. FSI valued the food at $1.50 per pound, based on a study undertaken by a national NFPO. All donated food is initially recorded in inventory. 10. Local residents donated 1,000 hours of their time serving food at FSI's facility. If the residents had not donated their time, FSI would have paid $5.50 an hour for the services.
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