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Question: You are a believer that new employees should practice their accounting skills before "throwing th...

You are a believer that new employees should practice their accounting skills before "throwing them into the fire." Therefore, you have listed a series of transactions that require journal entries and updating of T-Accounts.

You know that preparing nonprofit journal entries are easy, so you ask the new employee to

• prepare, side by side, the correct journal entry for the identical transaction:
  • once for a nonprofit entity
  • once for a for-profit company
• include notes for each transaction

1. Transaction 1: Assume that a nonprofit has a need for $80,000 for a particular new marketing expenditure, and a for-profit entity needs to raise an additional $80,000 to pay for some unanticipated marketing expenses. How would the journal entities look at the acquisition of the funds and the subsequent spending of the funds?
2. Transaction 2: The for-profit entity sells $120,000 with net 30-day terms, while the nonprofit entity has a fund raising drive for which they receive pledges of $120,000. How do the two journal entries look?