Question
Community Service, Inc. is a nongovernmental not-for-profit voluntary health and welfare calendar-year organization that began operations on January 1, Year 1. It performs voluntary services
Community Service, Inc. is a nongovernmental not-for-profit voluntary health and welfare calendar-year organization that began operations on January 1, Year 1. It performs voluntary services and derives its revenue primarily from voluntary contributions from the general public. Community imposes a time restriction on all promises to contribute cash in future periods. However, no such policy exists with respect to gifts of long-lived assets. Selected transactions that occurred during Community's Year 2 calendar year:
Debt security endowment received in Year 2; income to be used for community services: | ||
Face value | $95,000 | |
Fair value at time of receipt | 89,000 | |
Fair value at 12/31/Year 2 | 86,000 | |
Interest earned in Year 2 | 9,500 | |
Interest received in Year 2 | 4,750 | |
10 concerned citizens volunteered to serve meals to the homeless (400 hours free; fair market value of services $5 per hour): | 2,000 | |
Short-term investment in equity securities in Year 2: | ||
Cost | 10,000 | |
Fair Value 12/31/Year 2 | 12,000 | |
Dividend income | 1,250 | |
Reading materials donated to Community and distributed to the children in Year 2: | ||
Fair market value | 7,500 | |
Federal youth training fee for services grant | ||
Cash received during Year 2 | 30,000 | |
Instructor salaries paid | 25,000 | |
Other cash operating expenses: | ||
Business manager salary | 55,000 | |
General bookkeeper salary | 37,800 | |
Director of community activities salary | 60,000 | |
Space rental (75% for community activities 25% for office activities) | 30,000 | |
Printing and mailing costs for pledge cards | 2,750 | |
Interest payment on short-term bank loan in Year 2 | 1,250 | |
Principal payment on short-term bank loan in Year 2 | 750 |
Using the information provided in the exhibit, determine the amount to be reported in the financial statements for each element listed for the year ended December 31, Year 2. A B 1 Contributions - with donor restrictions 123 2 Investment income - debt securities 123 123 3 Program expenses 123 4 General fund-raising expense (excludes special events) 123 5 Income on long-term investments - without donor restrictions 123 6 Contributed voluntary services
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