Question 6

Reporting Promises At the beginning of 2023, the Museum of History receives a documented promise to contribute $20,000 at the end of each year for the next four years. The appropriate discount rate is 3.5 percent, and the promise is considered fully collectible. The donor requires that the museum use the contribution to support educational programs for children. At the end of 2023, the museum receives the first payment. Required Prepare journal entries to record the promise and the first years contribution. If the museums net assets are affected, indicate the appropriate category of net assets.

Round your answers to the nearest whole number.

Description		Debit	Credit
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
Contribution revenue - restricted		Answer	Answer
To record the present value of the documented promise.
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
To record interest earned on outstanding contributions receivable.
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
To record release of restriction.
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
AnswerCashContribution revenue-restrictedContributions receivableDiscount on contributions receivableNet assets released from time restriction-restrictedNet assets released from time restriction-unrestrictedNet assets released from use restrictions-restrictedNet assets released from use restrictions-unrestricted		Answer	Answer
To record donor's contribution for the year.