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INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2020. During the fiscal year ended December 31, 2020, the following
INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2020. During the fiscal year ended December 31, 2020, the following transactions occurred.
- A business donated rent-free office space to the organization that would normally rent for $36,300 a year.
- A fund drive raised $191,500 in cash and $113,000 in pledges that will be paid within one year. A state government grant of $163,000 was received for program operating costs related to public health education.
- Salaries and fringe benefits paid during the year amounted to $209,860. At year-end, an additional $17,300 of salaries and fringe benefits were accrued.
- A donor pledged $113,000 for construction of a new building, payable over five fiscal years, commencing in 2022. The discounted value of the pledge is expected to be $95,560.
- Office equipment was purchased for $13,300. The useful life of the equipment is estimated to be four years. Office furniture with a fair value of $10,900 was donated by a local office supply company. The furniture has an estimated useful life of 10 years. Furniture and equipment are considered net assets without donor restrictions by INVOLVE.
- Telephone expense for the year was $6,500, printing and postage expense was $13,300 for the year, utilities for the year were $9,600 and supplies expense was $5,600 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accounts payable was $4,900.
- Volunteers contributed $16,300 of time to help with answering the phones, mailing materials, and various other clerical activities.
- It is estimated that 80 percent of the pledges made for the 2021 year will be collected. Depreciation expense is recorded for the full year on the assets recorded in item 5.
- All expenses were allocated to program services and support services in the following percentages: public health education, 40 percent; community service, 20 percent; management and general, 20 percent; and fund-raising, 20 percent.
- Net assets were released to reflect satisfaction of state grant requirements that the grant resources be used for public health education program purposes.
- All nominal accounts were closed to the appropriate net asset accounts.
Choices:
- No Journal Entry Required
- Accounts Payable
- Allowance for DepreciationEquipment and Furniture
- Allowance for Uncollectible PledgesUnrestricted
- Cash
- Commission Revenue
- Community Art Education Program
- Community Service Program
- Contributions Receivable
- ContributionsWith Donor RestrictionsProgram
- ContributionsWith Donor RestrictionsTime
- ContributionsWithout Donor Restrictions
- Deferred Revenue
- Depreciation Expense
- Discount on Contributions Receivable
- Equipment and Furniture
- Exhibition Program
- Fund-Raising
- Grants Receivable
- Investment IncomeWith Donor Restrictions
- Investment IncomeWithout Donor Restrictions
- Management and General
- Membership Dues
- Miscellaneous Expense
- Net Assets ReleasedSatisfaction of Purpose RestrictionWith Donor Restrictions
- Net Assets ReleasedSatisfaction of Purpose RestrictionWithout Donor Restrictions
- Net Assets With Donor Restrictions
- Net Assets Without Donor Restrictions
- Payable to Artists
- Prepaid Expenses
- Printing and Postage Expense
- Program Expenses
- Provision for Uncollectible Pledges
- Public Health Education Program
- Rent Expense
- Salaries and Benefits Expense
- Salaries and Benefits Payable
- Short-Term Investments
- Supplies Expense
- Telephone Expense
- Tuition and Fees
- Utilities Expense
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