The Sunwapta Sports Association is an NFPO. It commenced operations on December 1, 2020. Its purpose is to provide sports activities, training, transportation, and facilities for children and youth in a rural Canadian municipality. It had a small amount of activity during 2020. At December 31, 2020, its statement of financial position was as follows:

Current Assets
Cash	$7,000
Current Liabilities
Deferred contributions	5,000
Net Assets
Operating fund	2,000
	$7,000

The deferred contributions at December 31, 2020 will be used to cover 2021 operating expenses. The following events occurred during 2021.

• On January 1, 2021, Donor A contributed $2,500,000 cash to the association. The terms of the contribution stipulated that the amount may be used to purchase land and buildings for sports facilities. Any remainder must be invested. The interest earned can be used to subsidize future capital fund purchases.
• A director and two staff were hired on January 1, 2021.
• On January 1, 2021, land and buildings were purchased for $1,000,000 cash. The building was valued at 80 percent of the purchase price. It will be depreciated over 40 years on the straight-line basis. It has no residual value. No capital purchases are planned for the next several years.
• $1,500,000 of Donor A's donation has been invested in guaranteed investment certificates. No interest has been paid in 2021. At December 31, 2021, $60,000 of interest revenue has accrued.
• A $225,000 grant from the province was received on August 31. One-half of this is 2021 revenue. The other half is 2022 revenue.

The director has provided a schedule of cash receipts and disbursements for the year ended December 31, 2021 as follows:

Receipts
Donation - donor A		$2,500,000
Grant - province		225,000
			$2,725,000
Expenses
Land and buildings		1,000,000
Salaries and benefits		48,000
Transportation		20,000
			1,068,000
Excess of receipts over disbursements			1,657,000
Cash and cash equivalents at start of year			7,000
Cash and cash equivalents at end of year			$1,664,000
Represented by
Cash in bank			$164,000
GICs			1,500,000
			$1,664,000

Required:

a. Create a statement of operations, statement of changes in net assets, and a statement of financial position at year end December 31, 2021. Assume the restricted fund method is used and separate funds are maintained for operating and capital funds.

b.Repeat the instructions in a., assuming the deferral method and the same two funds.