PROBLEM 3: NET ASSET CLASSIFICATION (14 PTS.) The following transactions pertain to the activities of the Lexington Players (LP), a private not- for-profit theater. For each transaction below, state which classification of net assets is correct: A. Affects Without Donor Restrictions Only B. Affects With Donor Restrictions Only C. Affects Both With and Without Donor Restrictions D. Affects Neither With Nor Without Donor Restrictions For each transaction below, write the one best letter (A, B, C, or D) in the designated space(s) In Year 1, LP receives a cash donation of $5,000, which must be used for a specific performance to be attended only by disadvantaged youths a. 1n Year 2, LP gives the performance referred to in transaction a. c. LP spends $50,000 on fund-raising expenses. LP receives the donation of a building valued at $600,000. d. e. Dame Edna donates $16,000, stipulating that, starting next year, the money should be used to help meet its regular program and administrative expenses, at the rate of $4,000 a year. perpetuity, with the income used for experimental theater productions. g.The income related to f.above is earned. h. An architect contributes his architectural services to the design of the new theater wing. i. The ushers donate their services in exchange for seeing the productions for free. j. A wealthy theater patroness makes an unrestricted donation of $100,000 to LP with the stipulation that LP must raise $200,000 in new contributions within the next year or her donation must be returned. No new contributions have been raised at this point. k. LP meets the stipulation in j. above. 1. Lady Gaga pledges to give $1,000,000 to LP. The gift is without restrictions but will not be received until next year -m. LP receives Lady Gaga's pledge from I. above. n. LP sells $100,000 in tickets to its latest production that concluded this week. PROBLEM 3: NET ASSET CLASSIFICATION (14 PTS.) The following transactions pertain to the activities of the Lexington Players (LP), a private not- for-profit theater. For each transaction below, state which classification of net assets is correct: A. Affects Without Donor Restrictions Only B. Affects With Donor Restrictions Only C. Affects Both With and Without Donor Restrictions D. Affects Neither With Nor Without Donor Restrictions For each transaction below, write the one best letter (A, B, C, or D) in the designated space(s) In Year 1, LP receives a cash donation of $5,000, which must be used for a specific performance to be attended only by disadvantaged youths a. 1n Year 2, LP gives the performance referred to in transaction a. c. LP spends $50,000 on fund-raising expenses. LP receives the donation of a building valued at $600,000. d. e. Dame Edna donates $16,000, stipulating that, starting next year, the money should be used to help meet its regular program and administrative expenses, at the rate of $4,000 a year. perpetuity, with the income used for experimental theater productions. g.The income related to f.above is earned. h. An architect contributes his architectural services to the design of the new theater wing. i. The ushers donate their services in exchange for seeing the productions for free. j. A wealthy theater patroness makes an unrestricted donation of $100,000 to LP with the stipulation that LP must raise $200,000 in new contributions within the next year or her donation must be returned. No new contributions have been raised at this point. k. LP meets the stipulation in j. above. 1. Lady Gaga pledges to give $1,000,000 to LP. The gift is without restrictions but will not be received until next year -m. LP receives Lady Gaga's pledge from I. above. n. LP sells $100,000 in tickets to its latest production that concluded this week
