the city of round lake receives a contribution
8. The City of Round Lake receives a contribution of $20 million. The donor stipulates that invested. The principal is to remain intact, and the investment proceeds are to be used to support a city-owned nature center. The city should report the contribution in a a. Special revenue fund b. Permanent fund ny Fiduciary fund d. Custodial fund 9. A city receives a $30 million contribution. The donor stipulates that the money is to be invested. The principal is to remain intact and the investment proceeds are to be used to provide scholarships for the children of city employees. The contribution should be reported as revenue of a C. a. Special revenue fund b.Permanent fund ritu c. Fiduciary fund d. Custodial fund 10. The Summerville Preparatory School (a private not-for-profit school) receives a donation of $14 million. The donor stipulates that the entire amount must be used to construct a new athletic field house. The school should classify the donation as a. Not restricted by donor b. Restricted by donor c. Semi-restricted d. No transaction should be recorded IND a auw Luu yuu juauy aun u uu JnL 4. Comment on the extent to which the statement of revenues, expenditures, and other financing sources captures the district's cost of services. How can you justify such a statement of revenues, expenditures, and other changes in fund balance? EX. 2-5 Funds are separate fiscal and accounting entities, each with its own self-balancing set of accounts. The newly established Society for Ethical Teachings, a not-for-profit organization, maintains two funds-a general fund for operations and a building fund to accumulate resources for a new building. In its first year, it engaged in the following transactions: 1. It received cash contributions of $200,000, of which $40,000 were restricted to the acquisition of the new building 2. It incurred operating costs of $130,000, of which it paid $120,000 in cash. 3. It earned $3,000 of interest (the entire amount received in cash) on resources restricted to the acquisition of the new building 4. It transferred $17,000 from the operating fund to the new building fund. 5. It paid $12,000 in fees (accounted for as expenses) to an architect to draw up plans for the new building. a. Prepare journal entries to record the transactions. Be certain to indicate the fund in which these entries would be made. b. Prepare a statement of revenues, expenses, and other changes in fund balance and a balance sheet. Use a two-column format, one column for each of the funds. Note that for purposes of external reporting not-for- profits would not generally prepare statements on a fund basis. Instead, consistent with the requirements of the FASB, they would consolidate their funds into two categories of restrictiveness: without donor restrictions and with donor restrictions. air
