INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2017. During the fiscal year ended December 31, 2017, the following transactions occurred. 1. A business donated rent-free office space to the organization that would normally rent for $36,300 a year. 2. A fund drive raised $191,500 in cash and $113,000 in pledges that will be paid within one year. A state government grant of $163,000 was received for program operating cost related to public health education. 3. Salaries and fringe benefits paid during the year amounted to $209,860. At year-end, an additional $17,300 of salaries and fringe benefits were accrued. 4. A donor pledged $113,000 for construction of a new building, payable over five fiscal years, commencing in 2019. The discounted value of the pledge is expected to be $95,560. 5. Office equipment was purchased for $13,300. The useful life of the equipment is estimated to be 4 years. Office furniture with a fair value of $10,900 was donated by a local office supply company. The furniture has an estimated useful life of 10 years. Furniture and equipment are considered unrestricted net assets by INVOLVE. 6. Telephone expense for the year was $6,500, printing and postage expense was $13,300 for the year, utilities for the year were $9,600 and supplies expense was $5,600 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accounts payable was $4,900. 7. Volunteers contributed $16,300 of time to help with answering the phones, mailing materials, and various other clerical activities. 8. It is estimated that 80 percent of the pledges made for the 2018 year will be collected. Depreciation expense is recorded for the full year on the assets recorded in item 5. 9. Salaries and wages, and other expenses (except for the provision for uncollectible accounts which is allocated 100 percent to fund-raising) were allocated to program services and support services in the following percentages: public health education, 40 percent; community service, 20 percent; management and general, 20 percent; and fund-raising, 20 percent. 10. Net assets were released to reflect satisfaction of state grant requirements that the grant resources be used for public health education program purposes. 11. All nominal accounts were closed to the appropriate net asset accounts. Required a. Prepare journal entries to record these transactions. Expense transactions should be initially recorded by object classification; in entry 10 expenses will be allocated to functions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round the intermediate and final answers to the nearest dollar amount.) O Answer is complete and correct. No Transaction General Journal Debit Credit 01 Rent Expense 36,300 O Contributions-Unrestricted 36,300 O 2 02 Cash 354,500 O Contributions Receivable 113,000 276,000 O 191,500 O Contributions-Temporarily Restricted Contributions-Unrestricted 3 03 Salaries and Benefits Expense 227,160 O Cash 209,860 O Salaries and Benefits Payable 17,300 O 4 04 Contributions Receivable 113,000 O 95,560 O 17,440 O Contributions-Temporarily Restricted Discount on Contributions Receivable 5 05 Equipment and Fumiture 24,200 O Cash 13,300 O Contributions-Unrestricted 10,900 O 6 06 Telephone Expense 6,500 O Printing and Postage Expense 13,300 O 5,600 O 9,600 O Supplies Expense Utilities Expense Accounts Payable 4,900 O Cash 30,100 7 07 No Journal Entry Required 8 B(a) Provision for Uncollectible Pledges 22,600 O Allowance for Uncollectible Pledges-Unrestricted 22,600 O B(b) Depreciation Expense 4,415 O Allowance for Depreciation-Equipment and Fumiture 4,415 O 121,150 60,575 O 10 09 Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 227,160 O 36,300 O Salaries and Benefits Expense Rent Expense Telephone Expense Printing and Postage Expense 6,500 O 13,300 Utilities Expense 9,600 O Supplies Expense 5,600 O Depreciation Expense 4,415 Provision for Uncollectible Pledges 22,600 O 11 10 Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121,150 O 238,700 O 86,775 O 12 11(a) Contributions-Unrestricted Unrestricted Net Assets 121,150 O 60,575 O Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 13 11(b) Contributions-Temporarily Restricted 371,560 O Temporarily Restricted Net Assets 371,560 O 14 11(c) Temporarily Restricted Net Assets 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O 15 11(d) Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121, 150 O Unrestricted Net Assets 121,150 O b. Prepare a statement of activities for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount.) Answer is complete and correct. INVOLVE Statement of Activities For the Year Ended December 31, 2017 Temporarily Restricted Unrestricted Total Revenue and Other Support: 238,700 O $ 121,150 O Contributions 2$ 371,560 O $ 610,260 Net Assets Released from Restriction Satisfaction of Purpose (121,150) O Total Revenue and Other Support 359.850 250,410 610,260 Expenses: Public Health Education 121,150 121,150 Community Service 60,575 O 60,575 Management and General 60,575 60,575 Fund-Raising 83,175 O 83,175 Total Expenses 325,475 325,475 Increase in Net Assets 34,375 250,410 284,785 Beginning Net Assets Ending Net Assets 2$ 34,375 2$ 250,410 $ 284,785 c. Prepare a statement of financial position for the year ended December 31, 2017. (Round the intermediate and final answers to the nearest dollar amount.) Answer is complete but not entirely correct. INVOLVE Statement of Financial Position December 31, 2017 Assets Cash 101,240 O Contributions Receivable 95,560 X Equipment and Furniture 19,785 Total Assets $ 216,585 Liabilities Accounts Payable 4,900 O Salaries Benefits Payable 17,300 Total Liabilities 22,200 Net Assets Unrestricted 34,375 Temporarily Restricted 250,410 O Total Net Assets 284,785 Total Liabilities and Net Assets 2$ 306,985 d. Prepare a statement of cash flows for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount) X Answer is complete but not entirely correct. INVOLVE Statement of Cash Flows For the Year Ended December 31, 2017 Cash Flows from Operating Activities: Cash Received from Contributions 354,500 Cash Paid to Employees (209,860) O Cash Paid to Suppliers (30,100) Net Cash Provided by Operating Activities 114,540 Cash Flows from Investing Activities: Purchase of Equipment (13,300) Net Increase in Cash 101,240 Beginning Cash Ending Cash 2$ 101,240 Reconciliation of Changes in Net Assets to Net Cash Provided by Operating Activities Change in Net Assets 284,785 Adjustments to Reconcile Changes in Net Assets to Net Cash Provided by Operating Activities: Depreciation 4,415 Increase in Net Contributions Receivable (95,560) X Increase in Accounts Payable 4,900 Increase in Salaries and Benefits Payable 17,300 Gift of Furniture (10,900) Cash Provided by Operating Activities $ 204,940 e. Prepare a statement of functional expenses for the year ended December 31, 2017. O Answer is complete and correct. INVOLVE Statement of Functional Expenses For the Year Ended December 31, 2017 All Program Services Support Services Services Public Health Education Community Service Management and General Fund- Total Raising 45,432 Os 45,432 Os 227,160 90,864 O S 14,520 O 2,600 O 45,432 O s 7,260 O 1,300 O Salaries and Benefits Expense 2$ $ Rent Expense Telephone Expense 7,260 O 7,260 36,300 1,300 O 1,300 6,500 Printing and Postage Expense Utilities Expense 5,320 2,660 O 2,660 O 2,660 13,300 3,840 O 2,240 1,920 O 1,120 O 1,920 O 1,920 9,600 Supplies Expense 1,120 1,120 5,600 Provision for Uncollectible Accounts 22,600 O 22,600 Depreciation Expense 1,766 O 883 O 883 883 4,415 Total $ 121,150 60,575 60,575 24 83,175 $ 325,475 INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2017. During the fiscal year ended December 31, 2017, the following transactions occurred. 1. A business donated rent-free office space to the organization that would normally rent for $36,300 a year. 2. A fund drive raised $191,500 in cash and $113,000 in pledges that will be paid within one year. A state government grant of $163,000 was received for program operating cost related to public health education. 3. Salaries and fringe benefits paid during the year amounted to $209,860. At year-end, an additional $17,300 of salaries and fringe benefits were accrued. 4. A donor pledged $113,000 for construction of a new building, payable over five fiscal years, commencing in 2019. The discounted value of the pledge is expected to be $95,560. 5. Office equipment was purchased for $13,300. The useful life of the equipment is estimated to be 4 years. Office furniture with a fair value of $10,900 was donated by a local office supply company. The furniture has an estimated useful life of 10 years. Furniture and equipment are considered unrestricted net assets by INVOLVE. 6. Telephone expense for the year was $6,500, printing and postage expense was $13,300 for the year, utilities for the year were $9,600 and supplies expense was $5,600 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accounts payable was $4,900. 7. Volunteers contributed $16,300 of time to help with answering the phones, mailing materials, and various other clerical activities. 8. It is estimated that 80 percent of the pledges made for the 2018 year will be collected. Depreciation expense is recorded for the full year on the assets recorded in item 5. 9. Salaries and wages, and other expenses (except for the provision for uncollectible accounts which is allocated 100 percent to fund-raising) were allocated to program services and support services in the following percentages: public health education, 40 percent; community service, 20 percent; management and general, 20 percent; and fund-raising, 20 percent. 10. Net assets were released to reflect satisfaction of state grant requirements that the grant resources be used for public health education program purposes. 11. All nominal accounts were closed to the appropriate net asset accounts. Required a. Prepare journal entries to record these transactions. Expense transactions should be initially recorded by object classification; in entry 10 expenses will be allocated to functions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round the intermediate and final answers to the nearest dollar amount.) O Answer is complete and correct. No Transaction General Journal Debit Credit 01 Rent Expense 36,300 O Contributions-Unrestricted 36,300 O 2 02 Cash 354,500 O Contributions Receivable 113,000 276,000 O 191,500 O Contributions-Temporarily Restricted Contributions-Unrestricted 3 03 Salaries and Benefits Expense 227,160 O Cash 209,860 O Salaries and Benefits Payable 17,300 O 4 04 Contributions Receivable 113,000 O 95,560 O 17,440 O Contributions-Temporarily Restricted Discount on Contributions Receivable 5 05 Equipment and Fumiture 24,200 O Cash 13,300 O Contributions-Unrestricted 10,900 O 6 06 Telephone Expense 6,500 O Printing and Postage Expense 13,300 O 5,600 O 9,600 O Supplies Expense Utilities Expense Accounts Payable 4,900 O Cash 30,100 7 07 No Journal Entry Required 8 B(a) Provision for Uncollectible Pledges 22,600 O Allowance for Uncollectible Pledges-Unrestricted 22,600 O B(b) Depreciation Expense 4,415 O Allowance for Depreciation-Equipment and Fumiture 4,415 O 121,150 60,575 O 10 09 Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 227,160 O 36,300 O Salaries and Benefits Expense Rent Expense Telephone Expense Printing and Postage Expense 6,500 O 13,300 Utilities Expense 9,600 O Supplies Expense 5,600 O Depreciation Expense 4,415 Provision for Uncollectible Pledges 22,600 O 11 10 Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121,150 O 238,700 O 86,775 O 12 11(a) Contributions-Unrestricted Unrestricted Net Assets 121,150 O 60,575 O Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 13 11(b) Contributions-Temporarily Restricted 371,560 O Temporarily Restricted Net Assets 371,560 O 14 11(c) Temporarily Restricted Net Assets 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O 15 11(d) Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121, 150 O Unrestricted Net Assets 121,150 O b. Prepare a statement of activities for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount.) Answer is complete and correct. INVOLVE Statement of Activities For the Year Ended December 31, 2017 Temporarily Restricted Unrestricted Total Revenue and Other Support: 238,700 O $ 121,150 O Contributions 2$ 371,560 O $ 610,260 Net Assets Released from Restriction Satisfaction of Purpose (121,150) O Total Revenue and Other Support 359.850 250,410 610,260 Expenses: Public Health Education 121,150 121,150 Community Service 60,575 O 60,575 Management and General 60,575 60,575 Fund-Raising 83,175 O 83,175 Total Expenses 325,475 325,475 Increase in Net Assets 34,375 250,410 284,785 Beginning Net Assets Ending Net Assets 2$ 34,375 2$ 250,410 $ 284,785 c. Prepare a statement of financial position for the year ended December 31, 2017. (Round the intermediate and final answers to the nearest dollar amount.) Answer is complete but not entirely correct. INVOLVE Statement of Financial Position December 31, 2017 Assets Cash 101,240 O Contributions Receivable 95,560 X Equipment and Furniture 19,785 Total Assets $ 216,585 Liabilities Accounts Payable 4,900 O Salaries Benefits Payable 17,300 Total Liabilities 22,200 Net Assets Unrestricted 34,375 Temporarily Restricted 250,410 O Total Net Assets 284,785 Total Liabilities and Net Assets 2$ 306,985 d. Prepare a statement of cash flows for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount) X Answer is complete but not entirely correct. INVOLVE Statement of Cash Flows For the Year Ended December 31, 2017 Cash Flows from Operating Activities: Cash Received from Contributions 354,500 Cash Paid to Employees (209,860) O Cash Paid to Suppliers (30,100) Net Cash Provided by Operating Activities 114,540 Cash Flows from Investing Activities: Purchase of Equipment (13,300) Net Increase in Cash 101,240 Beginning Cash Ending Cash 2$ 101,240 Reconciliation of Changes in Net Assets to Net Cash Provided by Operating Activities Change in Net Assets 284,785 Adjustments to Reconcile Changes in Net Assets to Net Cash Provided by Operating Activities: Depreciation 4,415 Increase in Net Contributions Receivable (95,560) X Increase in Accounts Payable 4,900 Increase in Salaries and Benefits Payable 17,300 Gift of Furniture (10,900) Cash Provided by Operating Activities $ 204,940 e. Prepare a statement of functional expenses for the year ended December 31, 2017. O Answer is complete and correct. INVOLVE Statement of Functional Expenses For the Year Ended December 31, 2017 All Program Services Support Services Services Public Health Education Community Service Management and General Fund- Total Raising 45,432 Os 45,432 Os 227,160 90,864 O S 14,520 O 2,600 O 45,432 O s 7,260 O 1,300 O Salaries and Benefits Expense 2$ $ Rent Expense Telephone Expense 7,260 O 7,260 36,300 1,300 O 1,300 6,500 Printing and Postage Expense Utilities Expense 5,320 2,660 O 2,660 O 2,660 13,300 3,840 O 2,240 1,920 O 1,120 O 1,920 O 1,920 9,600 Supplies Expense 1,120 1,120 5,600 Provision for Uncollectible Accounts 22,600 O 22,600 Depreciation Expense 1,766 O 883 O 883 883 4,415 Total $ 121,150 60,575 60,575 24 83,175 $ 325,475 INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2017. During the fiscal year ended December 31, 2017, the following transactions occurred. 1. A business donated rent-free office space to the organization that would normally rent for $36,300 a year. 2. A fund drive raised $191,500 in cash and $113,000 in pledges that will be paid within one year. A state government grant of $163,000 was received for program operating cost related to public health education. 3. Salaries and fringe benefits paid during the year amounted to $209,860. At year-end, an additional $17,300 of salaries and fringe benefits were accrued. 4. A donor pledged $113,000 for construction of a new building, payable over five fiscal years, commencing in 2019. The discounted value of the pledge is expected to be $95,560. 5. Office equipment was purchased for $13,300. The useful life of the equipment is estimated to be 4 years. Office furniture with a fair value of $10,900 was donated by a local office supply company. The furniture has an estimated useful life of 10 years. Furniture and equipment are considered unrestricted net assets by INVOLVE. 6. Telephone expense for the year was $6,500, printing and postage expense was $13,300 for the year, utilities for the year were $9,600 and supplies expense was $5,600 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accounts payable was $4,900. 7. Volunteers contributed $16,300 of time to help with answering the phones, mailing materials, and various other clerical activities. 8. It is estimated that 80 percent of the pledges made for the 2018 year will be collected. Depreciation expense is recorded for the full year on the assets recorded in item 5. 9. Salaries and wages, and other expenses (except for the provision for uncollectible accounts which is allocated 100 percent to fund-raising) were allocated to program services and support services in the following percentages: public health education, 40 percent; community service, 20 percent; management and general, 20 percent; and fund-raising, 20 percent. 10. Net assets were released to reflect satisfaction of state grant requirements that the grant resources be used for public health education program purposes. 11. All nominal accounts were closed to the appropriate net asset accounts. Required a. Prepare journal entries to record these transactions. Expense transactions should be initially recorded by object classification; in entry 10 expenses will be allocated to functions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round the intermediate and final answers to the nearest dollar amount.) O Answer is complete and correct. No Transaction General Journal Debit Credit 01 Rent Expense 36,300 O Contributions-Unrestricted 36,300 O 2 02 Cash 354,500 O Contributions Receivable 113,000 276,000 O 191,500 O Contributions-Temporarily Restricted Contributions-Unrestricted 3 03 Salaries and Benefits Expense 227,160 O Cash 209,860 O Salaries and Benefits Payable 17,300 O 4 04 Contributions Receivable 113,000 O 95,560 O 17,440 O Contributions-Temporarily Restricted Discount on Contributions Receivable 5 05 Equipment and Fumiture 24,200 O Cash 13,300 O Contributions-Unrestricted 10,900 O 6 06 Telephone Expense 6,500 O Printing and Postage Expense 13,300 O 5,600 O 9,600 O Supplies Expense Utilities Expense Accounts Payable 4,900 O Cash 30,100 7 07 No Journal Entry Required 8 B(a) Provision for Uncollectible Pledges 22,600 O Allowance for Uncollectible Pledges-Unrestricted 22,600 O B(b) Depreciation Expense 4,415 O Allowance for Depreciation-Equipment and Fumiture 4,415 O 121,150 60,575 O 10 09 Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 227,160 O 36,300 O Salaries and Benefits Expense Rent Expense Telephone Expense Printing and Postage Expense 6,500 O 13,300 Utilities Expense 9,600 O Supplies Expense 5,600 O Depreciation Expense 4,415 Provision for Uncollectible Pledges 22,600 O 11 10 Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121,150 O 238,700 O 86,775 O 12 11(a) Contributions-Unrestricted Unrestricted Net Assets 121,150 O 60,575 O Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 13 11(b) Contributions-Temporarily Restricted 371,560 O Temporarily Restricted Net Assets 371,560 O 14 11(c) Temporarily Restricted Net Assets 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O 15 11(d) Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121, 150 O Unrestricted Net Assets 121,150 O b. Prepare a statement of activities for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount.) Answer is complete and correct. INVOLVE Statement of Activities For the Year Ended December 31, 2017 Temporarily Restricted Unrestricted Total Revenue and Other Support: 238,700 O $ 121,150 O Contributions 2$ 371,560 O $ 610,260 Net Assets Released from Restriction Satisfaction of Purpose (121,150) O Total Revenue and Other Support 359.850 250,410 610,260 Expenses: Public Health Education 121,150 121,150 Community Service 60,575 O 60,575 Management and General 60,575 60,575 Fund-Raising 83,175 O 83,175 Total Expenses 325,475 325,475 Increase in Net Assets 34,375 250,410 284,785 Beginning Net Assets Ending Net Assets 2$ 34,375 2$ 250,410 $ 284,785 c. Prepare a statement of financial position for the year ended December 31, 2017. (Round the intermediate and final answers to the nearest dollar amount.) Answer is complete but not entirely correct. INVOLVE Statement of Financial Position December 31, 2017 Assets Cash 101,240 O Contributions Receivable 95,560 X Equipment and Furniture 19,785 Total Assets $ 216,585 Liabilities Accounts Payable 4,900 O Salaries Benefits Payable 17,300 Total Liabilities 22,200 Net Assets Unrestricted 34,375 Temporarily Restricted 250,410 O Total Net Assets 284,785 Total Liabilities and Net Assets 2$ 306,985 d. Prepare a statement of cash flows for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount) X Answer is complete but not entirely correct. INVOLVE Statement of Cash Flows For the Year Ended December 31, 2017 Cash Flows from Operating Activities: Cash Received from Contributions 354,500 Cash Paid to Employees (209,860) O Cash Paid to Suppliers (30,100) Net Cash Provided by Operating Activities 114,540 Cash Flows from Investing Activities: Purchase of Equipment (13,300) Net Increase in Cash 101,240 Beginning Cash Ending Cash 2$ 101,240 Reconciliation of Changes in Net Assets to Net Cash Provided by Operating Activities Change in Net Assets 284,785 Adjustments to Reconcile Changes in Net Assets to Net Cash Provided by Operating Activities: Depreciation 4,415 Increase in Net Contributions Receivable (95,560) X Increase in Accounts Payable 4,900 Increase in Salaries and Benefits Payable 17,300 Gift of Furniture (10,900) Cash Provided by Operating Activities $ 204,940 e. Prepare a statement of functional expenses for the year ended December 31, 2017. O Answer is complete and correct. INVOLVE Statement of Functional Expenses For the Year Ended December 31, 2017 All Program Services Support Services Services Public Health Education Community Service Management and General Fund- Total Raising 45,432 Os 45,432 Os 227,160 90,864 O S 14,520 O 2,600 O 45,432 O s 7,260 O 1,300 O Salaries and Benefits Expense 2$ $ Rent Expense Telephone Expense 7,260 O 7,260 36,300 1,300 O 1,300 6,500 Printing and Postage Expense Utilities Expense 5,320 2,660 O 2,660 O 2,660 13,300 3,840 O 2,240 1,920 O 1,120 O 1,920 O 1,920 9,600 Supplies Expense 1,120 1,120 5,600 Provision for Uncollectible Accounts 22,600 O 22,600 Depreciation Expense 1,766 O 883 O 883 883 4,415 Total $ 121,150 60,575 60,575 24 83,175 $ 325,475 INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2017. During the fiscal year ended December 31, 2017, the following transactions occurred. 1. A business donated rent-free office space to the organization that would normally rent for $36,300 a year. 2. A fund drive raised $191,500 in cash and $113,000 in pledges that will be paid within one year. A state government grant of $163,000 was received for program operating cost related to public health education. 3. Salaries and fringe benefits paid during the year amounted to $209,860. At year-end, an additional $17,300 of salaries and fringe benefits were accrued. 4. A donor pledged $113,000 for construction of a new building, payable over five fiscal years, commencing in 2019. The discounted value of the pledge is expected to be $95,560. 5. Office equipment was purchased for $13,300. The useful life of the equipment is estimated to be 4 years. Office furniture with a fair value of $10,900 was donated by a local office supply company. The furniture has an estimated useful life of 10 years. Furniture and equipment are considered unrestricted net assets by INVOLVE. 6. Telephone expense for the year was $6,500, printing and postage expense was $13,300 for the year, utilities for the year were $9,600 and supplies expense was $5,600 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accounts payable was $4,900. 7. Volunteers contributed $16,300 of time to help with answering the phones, mailing materials, and various other clerical activities. 8. It is estimated that 80 percent of the pledges made for the 2018 year will be collected. Depreciation expense is recorded for the full year on the assets recorded in item 5. 9. Salaries and wages, and other expenses (except for the provision for uncollectible accounts which is allocated 100 percent to fund-raising) were allocated to program services and support services in the following percentages: public health education, 40 percent; community service, 20 percent; management and general, 20 percent; and fund-raising, 20 percent. 10. Net assets were released to reflect satisfaction of state grant requirements that the grant resources be used for public health education program purposes. 11. All nominal accounts were closed to the appropriate net asset accounts. Required a. Prepare journal entries to record these transactions. Expense transactions should be initially recorded by object classification; in entry 10 expenses will be allocated to functions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round the intermediate and final answers to the nearest dollar amount.) O Answer is complete and correct. No Transaction General Journal Debit Credit 01 Rent Expense 36,300 O Contributions-Unrestricted 36,300 O 2 02 Cash 354,500 O Contributions Receivable 113,000 276,000 O 191,500 O Contributions-Temporarily Restricted Contributions-Unrestricted 3 03 Salaries and Benefits Expense 227,160 O Cash 209,860 O Salaries and Benefits Payable 17,300 O 4 04 Contributions Receivable 113,000 O 95,560 O 17,440 O Contributions-Temporarily Restricted Discount on Contributions Receivable 5 05 Equipment and Fumiture 24,200 O Cash 13,300 O Contributions-Unrestricted 10,900 O 6 06 Telephone Expense 6,500 O Printing and Postage Expense 13,300 O 5,600 O 9,600 O Supplies Expense Utilities Expense Accounts Payable 4,900 O Cash 30,100 7 07 No Journal Entry Required 8 B(a) Provision for Uncollectible Pledges 22,600 O Allowance for Uncollectible Pledges-Unrestricted 22,600 O B(b) Depreciation Expense 4,415 O Allowance for Depreciation-Equipment and Fumiture 4,415 O 121,150 60,575 O 10 09 Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 227,160 O 36,300 O Salaries and Benefits Expense Rent Expense Telephone Expense Printing and Postage Expense 6,500 O 13,300 Utilities Expense 9,600 O Supplies Expense 5,600 O Depreciation Expense 4,415 Provision for Uncollectible Pledges 22,600 O 11 10 Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121,150 O 238,700 O 86,775 O 12 11(a) Contributions-Unrestricted Unrestricted Net Assets 121,150 O 60,575 O Public Health Education Program Community Service Program Management and General 60,575 O Fund-Raising 83,175 O 13 11(b) Contributions-Temporarily Restricted 371,560 O Temporarily Restricted Net Assets 371,560 O 14 11(c) Temporarily Restricted Net Assets 121,150 O Net Assets Released-Satisfaction of Purpose Restriction-Temporarily Restricted 121,150 O 15 11(d) Net Assets Released-Satisfaction of Purpose Restriction-Unrestricted 121, 150 O Unrestricted Net Assets 121,150 O b. Prepare a statement of activities for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount.) Answer is complete and correct. INVOLVE Statement of Activities For the Year Ended December 31, 2017 Temporarily Restricted Unrestricted Total Revenue and Other Support: 238,700 O $ 121,150 O Contributions 2$ 371,560 O $ 610,260 Net Assets Released from Restriction Satisfaction of Purpose (121,150) O Total Revenue and Other Support 359.850 250,410 610,260 Expenses: Public Health Education 121,150 121,150 Community Service 60,575 O 60,575 Management and General 60,575 60,575 Fund-Raising 83,175 O 83,175 Total Expenses 325,475 325,475 Increase in Net Assets 34,375 250,410 284,785 Beginning Net Assets Ending Net Assets 2$ 34,375 2$ 250,410 $ 284,785 c. Prepare a statement of financial position for the year ended December 31, 2017. (Round the intermediate and final answers to the nearest dollar amount.) Answer is complete but not entirely correct. INVOLVE Statement of Financial Position December 31, 2017 Assets Cash 101,240 O Contributions Receivable 95,560 X Equipment and Furniture 19,785 Total Assets $ 216,585 Liabilities Accounts Payable 4,900 O Salaries Benefits Payable 17,300 Total Liabilities 22,200 Net Assets Unrestricted 34,375 Temporarily Restricted 250,410 O Total Net Assets 284,785 Total Liabilities and Net Assets 2$ 306,985 d. Prepare a statement of cash flows for the year ended December 31, 2017. (Negative amounts should be indicated by a minus sign. Round the intermediate and final answers to the nearest dollar amount) X Answer is complete but not entirely correct. INVOLVE Statement of Cash Flows For the Year Ended December 31, 2017 Cash Flows from Operating Activities: Cash Received from Contributions 354,500 Cash Paid to Employees (209,860) O Cash Paid to Suppliers (30,100) Net Cash Provided by Operating Activities 114,540 Cash Flows from Investing Activities: Purchase of Equipment (13,300) Net Increase in Cash 101,240 Beginning Cash Ending Cash 2$ 101,240 Reconciliation of Changes in Net Assets to Net Cash Provided by Operating Activities Change in Net Assets 284,785 Adjustments to Reconcile Changes in Net Assets to Net Cash Provided by Operating Activities: Depreciation 4,415 Increase in Net Contributions Receivable (95,560) X Increase in Accounts Payable 4,900 Increase in Salaries and Benefits Payable 17,300 Gift of Furniture (10,900) Cash Provided by Operating Activities $ 204,940 e. Prepare a statement of functional expenses for the year ended December 31, 2017. O Answer is complete and correct. INVOLVE Statement of Functional Expenses For the Year Ended December 31, 2017 All Program Services Support Services Services Public Health Education Community Service Management and General Fund- Total Raising 45,432 Os 45,432 Os 227,160 90,864 O S 14,520 O 2,600 O 45,432 O s 7,260 O 1,300 O Salaries and Benefits Expense 2$ $ Rent Expense Telephone Expense 7,260 O 7,260 36,300 1,300 O 1,300 6,500 Printing and Postage Expense Utilities Expense 5,320 2,660 O 2,660 O 2,660 13,300 3,840 O 2,240 1,920 O 1,120 O 1,920 O 1,920 9,600 Supplies Expense 1,120 1,120 5,600 Provision for Uncollectible Accounts 22,600 O 22,600 Depreciation Expense 1,766 O 883 O 883 883 4,415 Total $ 121,150 60,575 60,575 24 83,175 $ 325,475