Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required information Problem 18-45 (Static) (LO 18-1, 18-2, 18-4, 18-5, 18-8) [The following information applies to the questions displayed below] For a number of years,

image text in transcribed
Required information Problem 18-45 (Static) (LO 18-1, 18-2, 18-4, 18-5, 18-8) [The following information applies to the questions displayed below] For a number of years, a private not-for-profit entity has been preparing financial statements that do not necessarily conform to US generally accepted accounting principles. At the end of the most recent year (Year 2). those financial statements show total assets of $900,000, total liabilities of $100,000, net assets without donor restriction of $400,000, and net assets with donor restrictions of $400,000. This last category is composed of $300,000 in net assets with purpose restrictions and $100,000 in net assets that must be permanently held. At the end of Year 1, financial statements show total assets of $700,000, total liabilities of $60,000, net assets without donor restriction of $340,000, and net assets with donor restrictions of $300,000. This last category is composed of $220,000 in net assets with purpose restrictions and $80,000 in net assets that must be permanently held. Total expenses for Year 2 were $500,000 and reported under net assets without donor restrictions. Each part that follows should be viewed as an independent situation. Problem 18-45 Part Four Assume that this entity charges its members $100.000 each year (Year 1 and Year 2). The members get nothing in return for their dues. The entity has consistently recorded the cash collections as an increase in cash and an increase in exchange revenues under net assets without donor restrictions. The board of rustees has had a policy for several years that 10 percent of the money collected be set aside and nvested with the money held for emergency purposes. Cash is decreased and investments held for emergencies" are increased with each purchase. Required: a. What was the appropriate amount of net assets without donor restrictions at the end of Year 1? Net assets without donor restrictions at the end of Year 1 . What was the appropriate amount of net assets without donor restrictions at the end of Year 2? Net assets without donor restrictions at the end of Year 2 c. What was the appropriate amount of net assets with donor restrictions at the end of Year 2? Net assets with donor restrictions at the end of Year 2

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

Create a Fishbone diagram with the problem being coal "mine safety

Answered: 1 week ago