Question:

The Childrens Hospital was organized as a nongovernmental not-for-profit organization. The Hospital received a pledge of $10,000,000 to be used to build an addition to the intensive care unit. This donation will not be received for three years. How should this pledge be recorded?

1. As support with donor restrictions of the present value of $10,000,000.

2. As support with donor restrictions of 10,000,000.

3. As a conditional promise to give of 10,000,000.

4. It should not be accounted for until it is received.

Please explain th reasoning behind the right answer! Thank you!