2

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: til lance-December 31, 2020 Debita Credits Cash $12,000 Investments 532,000 Additions to permanent endowments $ 520,500 Investment income 58,500 Expenditures-subscriptions 46,500 Net Increase in fair value of investments 11,500 Accrued interest receivable 3,750 Accounts payable 3.750 $ 594,250 $596,250 Required: 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 Restricted to Subscriptions for any spendable fund balance)