On September 22, 2020, James Foundation donated $100,000 to William City for the maintenance of the walking track. She stipulated that the principal be invested but should never be spend. Only the profits will be used for the maintenance of the track. The city established a permanent fund. The income will be transferred to a special revenue fund.

Prepare journal entries to register for the following transactions:

1. The PF records the cash received as income.

2. The $100,000 was invested in stocks.

3. During the year, $5,000 of earned income was received on the investment.