The Fara Littlebear Society is an NFPO funded by government grants and private donations. It was established in Year 5 by the friends of Fara Littlebear to encourage and promote the work of Native Canadian artists. Fara achieved international recognition for her art depicting images of journey and exploration. The society leased a small building in January Year 5. The building contains a small art gallery on the first floor and office space on the second floor. The society spent $80,925 for leasehold improvements. The art gallery opened for public viewing on April 1 , Year 5. The unadjusted trial balance for the year ended December 31, Year 5, was as follows: Additional Information 1. A wealthy individual donated $60,000 with the condition that the principal be invested in low-risk investments. The principal was invested in long-term bonds, which are expected to be held to maturity. The interest on the bonds is to be used to provide scholarships to aspiring Native artists who wish to study art at a Canadian university or college. The first scholarship of $5,200 was awarded in September Year 5. 2. The artwork consists of 20 paintings from a number of Canadian artists. These paintings are expected to be held for at least 10 years. The paintings will likely appreciate in value over the time they are owned by the art gallery. 3. The society signed a five-year lease on the building with an option to renew for one further term of 5 years. The term of the lease commenced on January 1 , Year 5 . The total rent paid for the year included a deposit of $2,000 for the last month's rent. The leasehold improvements were completed on March 31, Year 5. The office space was occupied by the staff of the society, and the art gallery was opened for business on April 1, Year 5. 4. Salaries earned but not yet paid amounted to $3,500 at December 31 , Year 5. 5. The society received office equipment from a local business person on January 1, Year 5 . A donation receipt for $25,000 was given for this contribution. The office equipment has a useful life of five years with no residual value. 6. The provincial government provided an operating grant of $90,000 for Year 5 , of which $81,000 was received by the end of the year. The remaining $9,000 will be received once the society provides financial statements prepared in accordance with GAAP. Required: (a) This part of the question is not part of your Connect assignment. (b) Prepare a statement of financial position for the society at December 31, Year 5. (You can use an assumed number for excess of revenue over expenses to balance your statement of financial position.) (Amounts to be deducted should be indicated with a minus sign.) The Fara Littlebear Society is an NFPO funded by government grants and private donations. It was established in Year 5 by the friends of Fara Littlebear to encourage and promote the work of Native Canadian artists. Fara achieved international recognition for her art depicting images of journey and exploration. The society leased a small building in January Year 5. The building contains a small art gallery on the first floor and office space on the second floor. The society spent $80,925 for leasehold improvements. The art gallery opened for public viewing on April 1 , Year 5. The unadjusted trial balance for the year ended December 31, Year 5, was as follows: Additional Information 1. A wealthy individual donated $60,000 with the condition that the principal be invested in low-risk investments. The principal was invested in long-term bonds, which are expected to be held to maturity. The interest on the bonds is to be used to provide scholarships to aspiring Native artists who wish to study art at a Canadian university or college. The first scholarship of $5,200 was awarded in September Year 5. 2. The artwork consists of 20 paintings from a number of Canadian artists. These paintings are expected to be held for at least 10 years. The paintings will likely appreciate in value over the time they are owned by the art gallery. 3. The society signed a five-year lease on the building with an option to renew for one further term of 5 years. The term of the lease commenced on January 1 , Year 5 . The total rent paid for the year included a deposit of $2,000 for the last month's rent. The leasehold improvements were completed on March 31, Year 5. The office space was occupied by the staff of the society, and the art gallery was opened for business on April 1, Year 5. 4. Salaries earned but not yet paid amounted to $3,500 at December 31 , Year 5. 5. The society received office equipment from a local business person on January 1, Year 5 . A donation receipt for $25,000 was given for this contribution. The office equipment has a useful life of five years with no residual value. 6. The provincial government provided an operating grant of $90,000 for Year 5 , of which $81,000 was received by the end of the year. The remaining $9,000 will be received once the society provides financial statements prepared in accordance with GAAP. Required: (a) This part of the question is not part of your Connect assignment. (b) Prepare a statement of financial position for the society at December 31, Year 5. (You can use an assumed number for excess of revenue over expenses to balance your statement of financial position.) (Amounts to be deducted should be indicated with a minus sign.)
