Hello, I am having trouble with my Advanced Accounting Ch 18 homework. Accountin

Question

Hello, I am having trouble with my Advanced Accounting Ch 18 homework. Accounting for nonprofts. Here are a few questions: At the beginning of the year, Nutrition Now, a health and welfare not-for-profit entity, had the following equity balances: Net assets without donor restriction $400,000 Net assets with donor restriction $290,000

1. Unrestricted contributions (pledges) of $250,000, to be collected in cash in thirty days, before the end of the year, are received.

2. Salaries of $27,000 are paid with $3,000 of that amount coming from restricted funds

3. Equipment is bought for $85,000 by signing a long-term note for $30,000 and using restricted funds for the remainder.

4. A contribution (pledge) of $80,000 is received that will be collected in three years. Present
value is $68,000. Donors have not placed restrictions on the eventual use.

5. A donor gives $37,000 to the charity that must be conveyed to another not-for-profit when
the Board of directors decides which other organization should get the money.

show how each of the following transactions would affect the organization's equity balances.

Thank you

Explanation / Answer

Organisation equity balance Transaction Particulars Unrestricted Restricted 0 Opaning Balance $        4,00,000 $        2,90,000 1 Unrestricted contribution $        2,50,000 $                     -   2 Salaries paid $         (24,000) $            (3,000) 3 Equipment bought $                     -   $                     -   Note 1 4 Contribution pledge $                     -   $                     -   Note 2 5 Donor Contibution $                     -   $                     -   Note 3 Note Number 1 No effect as asset purchased 2 No effect untill recevied 3 No effect as it is libility not equity till BOD decides

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