Please answer the question 11-10.

Question 11-9 was given because of the information asked by question 11-10.

119.

The Great Lakes Maritime Institute is a public institution preparing cadets for careers in commercial shipping and includes instruction in piloting, navigation, maritime law, and other fields.

The Institute began the year with the following account balances:

Beginning Balances July 1, 2016
	Debits	Credits
Cash	$250,000
Student Accounts Receivable	15,000
InvestmentsEndowment	500,000
Restricted Cash	250,000
Capital Assets	1,000,000
Accumulated Depreciation		$350,000
Accounts Payable and Accrued Liabilities		5,000
Deferred Revenues		6,000
Net Investment in Capital Assets		650,000
Restricted Net Position		750,000
Unrestricted Net Position		254,000

The Institute received a state appropriation of $75,000 and unrestricted gifts of $10,000.

The deferred revenue appearing on the beginning of the year trial balance represents the portion of summer school tuition received in the previous academic year that relates to classes held in the current year.

Students were billed for tuition and fees of $500,000 and room and board of $190,000. A total of $350,000 was received on student accounts throughout the year.

The Institute received $110,000 of Pell Grants during the academic year. These amounts were immediately applied to student accounts for amounts due for tuition and fees.

Students are awarded academic scholarships of $150,000, which are applied to their accounts. Additionally, several other students are hired by the Institute to work in the Institutes dining hall (auxiliary enterprise). As part of their compensation for working, tuition in the amount of $25,000 is waived.

The $250,000 restricted cash balance at the beginning of the year was donated for a new training ship. During the year an additional $250,000 donation was received.

The Institute signed a long-term note payable for $200,000. These funds, together with the restricted cash, were used to buy the training ship. The training ships expenses are classified as instruction.

During the year, $100,000 of cash and pledges for an additional $200,000 were received as a result of fund-raising campaigns to enhance the page 343Institutes endowment. By the terms of the agreement, such contributions are to remain permanently in the endowment. The $100,000 was immediately used to purchase additional investments.

By terms of the endowment agreement, interest and dividends received on the investments are restricted for need-based scholarships. Gains or losses from changes in the fair value of the investments, however, are not distributed but remain in the endowment. During the year, $27,000 of interest and dividends were received on endowment investments. At year-end, the fair value of the investments had increased by $4,000.

Expenses totaling $685,000 for salaries, supplies, utilities, and other items to be paid in cash are approved for payment through accounts payable. A total of $460,000 of outstanding accounts payable were paid by year-end. Although both GASB and FASB permit classification by natural category, the functional categories appearing below are recommended by NACUBO (amounts are assumed).

Included in the expenses recorded in the previous transactions are $125,000 incurred under federal and state government reimbursement-type grants. Bills were sent to the granting agencies, and $106,500 was received by the end of the year.

Adjusting entries:

The note payable was dated April 1, 2017. Interest is paid annually on March 31. The Institute accrued 3 months of interest at 6 percent.

Each year, a portion of the amount received as summer school tuition is deferred to the next academic year. The amount to be deferred is determined to be $7,500.

Depreciation expense of $165,000 is recorded on buildings and equipment. The expense is allocated to functional areas on the basis of actual equipment in use and square footage for buildings (amounts assumed).

Required:

Prepare journal entries recording the events above for the year ending December 31, 2017.

Post the journal entries to T-accounts.

Prepare closing entries.page 344

Prepare a Statement of Revenues, Expenses, and Changes in Net Position.

Prepare a Statement of Net Position.

Prepare a Statement of Cash Flows.

1110.

This exercise uses the same fact setting as Exercise 11-9 except that items 1 and 2 are changed to be consistent with a private institution.

The Great Lakes Maritime Institute is a private not-for-profit institution preparing cadets for careers in commercial shipping and includes instruction in piloting, navigation, maritime law, and other fields.

The Institute began the year with the following account balances:

Beginning Balances July 1, 2016
	Debits	Credits
Cash	$250,000
Student Accounts Receivable	15,000
InvestmentsEndowment	500,000
Restricted Cash	250,000
Capital Assets	1,000,000
Accumulated Depreciation		$350,000
Accounts Payable and Accrued Liabilities		5,000
Deferred Revenues		6,000
Permanently Restricted Net Assets		500,000
Temporarily Restricted Net Assets		250,000
Unrestricted Net Assets		904,000

The Institute received an unrestricted operating grant of $75,000 from the Maritime Shipping Association, a trade association for commercial shipping firms. Additionally, the Institute received unrestricted gifts of $10,000.

Items 315 are the same as in Exercise 11-9.

Required:

Prepare journal entries recording the events above for the year ending December 31, 2017.

Post the journal entries to T-accounts.

Prepare closing entries.

Prepare a Statement of Activity.

Prepare a Statement of Financial Position.

Prepare a Statement of Cash Flows.