SPARK was incorporated as a nonprofit voluntary health and welfare organization onJanuary 1, 2015. During the fiscal year ended December 31, 2015, the followingtransactions occurred:1. A business donated rent-free office space to the organization that would normallyrent for $16,000 a year.2. A fund drive raised $120,000 in cash. A state government grant of $50,000 wasreceived for program operating costs.3. An administrator was hired to administer the program services and supportservices of the organization. The administrator was paid $92,000 for the year,which included fringe benefits. Part-time clerical help was paid $26,000 for theyear. At year-end, $18,000 of the salaries and wages remained unpaid.4. Pledges of $100,000 were received for construction of a new building. Thepledges are payable over the following five fiscal years. The discounted value ofthe $80,000 in pledges expected to be received in years 2016-2019 is $73,400.5. Office equipment was purchased for $5,000. The useful life of the equipment isestimated to be five years. Office furniture with a fair value of $7,600 wasdonated by a local office supply company. The furniture has an estimated usefullife of 10 years. Furniture and equipment are considered unrestricted net assetsby SOLVE.6. Telephone expense for the year was $5,600, printing and postage expense was$10,000 for the year, and supplies expense was $2,100 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accountspayable was $3,800.7. Volunteers contributed $15,000 of time to help with answering the phones,mailing materials, and various other clerical activities.8. It is estimated that all of the pledges made for the 2015 year will be collected.Depreciation expense is recorded for the full year on the assets recorded in item5.9. Expenses were allocated in the following percentages: public health education,35%; community service, 25%; management and general, 20%; and fundraising,20%.10.Net assets were released to reflect satisfaction of state grant requirements thatthe grant resources be used for program purposes.11.All nominal accounts were closed to the appropriate net asset accounts.RequiredA. Make all necessary journal entries to record these transactions. Expensetransactions should be initially recorded by object classification; in entry 10,expenses will be allocated to functions.B. Prepare a statement of activities for the year ended December 31, 2014.C. Prepare a statement of financial position for the year ended December 31, 2014.D. Prepare a statement of cash flows for the year ended December 31, 2014.E. Prepare a statement of functional expenses for the year ended December 31,2014.

SPARK General Journal Entries Jul-05 Date Accounts Debit Credit ALLOCATION OF NATURAL EXPENSES TO FUNCTIONS Public Health Education Salary & Wages Expense Rent Expense Telephone Expense Printing & Postage Expense Supplies Expense Depreciation Expense Total Community Service Management & General Fund-raising Total SPARK STATEMENT OF ACTIVITIES FOR THE YEAR ENDED DECEMBER 31, 2015 UNRESTRICTED REVENUE & OTHER SUPPORT: CONTRIBUTIONS NET ASSETS RELEASED FROM RESTRICTION SATISFACTION OF PURPOSE TOTAL REVENUE & OTHER SUPPORT EXPENSES: PUBLIC HEALTH EDUCATION COMMUNITY SERVICES MANAGEMENT & GENERAL FUND-RAISING TOTAL EXPENSES INCREASE IN NET ASSETS BEGINNING NET ASSETS ENDING NET ASSETS SPARK ENT OF ACTIVITIES ED DECEMBER 31, 2015 TEMPORARILY RESTRICTED TOTAL SPARK STATEMENT OF FINANCIAL POSITION 31-Dec-15 ASSETS: CASH CONTRIBUTIONS RECEIVABLE (less discount on contributions receivable) EQUIPMENT & FURNITURE (less allowance for accumulated depreciation ) TOTAL ASSETS LIABILITIES: ACCOUNTS PAYABLE SALARIES PAYABLE TOTAL LIABILITIES NET ASSETS: UNRESTRICTED TEMPORARILY RESTRICTED TOTAL NET ASSETS TOTAL LIABILITIES AND NET ASSETS SPARK STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2015 CASH FLOWS FROM OPERATING ACTIVITIES: CASH RECEIVED FROM CONTRIBUTIONS CASH PAID TO EMPLOYEES CASH PAID TO SUPPLIERS NET CASH PROVIDED BY OPERATING ACTIVITIES CASH FLOWS FROM INVESTING ACTIVITIES: PURCHASE OF EQUIPMENT NET INCREASE IN CASH BEGINNING CASH ENDING CASH RECONCILIATION OF CHANGES IN NET ASSETS TO NET CASH PROVIDED BY OPERATING ACTIVITIES: CHANGE IN NET ASSETS ADJUSTMENTS TO RECONCILE CHANGES IN NET ASSETS TO NET CASH PROVIDED BY OPERATING ACTIVITIES: DEPRECIATION INCREASE IN NET CONTRIBUTIONS RECEIVABLE INCREASE IN ACCOUNTS PAYABLE INCREASE IN SALARIES & WAGES PAYABLE GIFT OF FURNITURE CASH PROVIDED BY OPERATING ACTIVITIES WS R 31, 2015 SPARK STATEMENT OF FUNCTIONAL EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2015 PROGRAM SERVICES Public Health Education SALARY & WAGES EXPENSE RENT EXPENSE TELEPHONE EXPENSE PRINTING & POSTAGE EXPENSE SUPPLIES EXPENSE DEPRECIATION EXPENSE TOTAL Community Service ARK TIONAL EXPENSES DECEMBER 31, 2015 SUPPORT SERVICES Management & General Fundraising TOTAL