1. On July 15, a nonprofit received a donation of Apple stock that had a fair value of $60,000 at the time of the donation. The donor told the nonprofit that the stock could be sold and used only to finance a particular research project. 2. On December 31, when the nonprofit closed its books, the stock had a fair value of $61,200. 3. On February 15, the nonprofit sold the stock for $60,800. 4. On March 15, the nonprofit spent the entire $60,800 on the research project for which the donor made the gift. 1 Investments Recognizing gains and losses using a single account Contribution revenues - with donor restriction To record the contribution revenue 2 Investments Unrealized and realized gains and losses with donor restrictions To recognize the investment unrealized gains or losses 3 Cash Unrealized and realized gains and losses with donor restrictions Investments To record the sale of stock investments 4 Net assets with donor restrictions - reclassifications out - satisfaction of program restrictions Net assets without donor restrictions - reclassifications in - satisfaction of program restrictions To record the reclassifications of program restrictions Program expenses Cash To record the program expenses Debits 60,000 Credits 0 60,000 1,200 0 0 1,200 60,800 400 0 0 0 61,200 60,800 0 0 60,800 60,800 0 0 60,800 Recognizing gains and losses using separate gains and losses accounts Debits Credits 1 Investments 1,200 Unrealized and realized gains and losses with donor restrictions 0 0 x 1,200 x To record the contribution revenue 2 Unrealized and realized gains and losses with donor restrictions Investments To record the investment unrealized gains and losses 3 To record change in unrealized gains and losses on sale of stock investments To record the sale of the stock investments To record the reclassifications of program restrictions To record the program expenses 1,200 0 x 0 1,200 x 0 0 x 0 0 x 0 0 % 0 0 x 0 0 x 0 0 x 0 0 x 0 0 x 0 0 x