A private not-for-profit entity is working to create a cure for a deadly disease. The charity starts the year with cash of $712,000. Of this amount, unrestricted net assets total $404,000, temporarily restricted net assets total $204,000, and permanently restricted net assets total $104,000. Within the temporarily restricted net assets, the entity must use 80 percent for equipment and the rest for salaries. No implied time restriction has been designated for the equipment when purchased. For the permanently restricted net assets, 70 percent of resulting income must be used to cover the purchase of advertising for fund-raising purposes and the rest is unrestricted.
During the current year, the organization has the following transactions:
Prepare a statement of financial position for this not-for-profit entity for this year.
Statement of Activities
Unrestricted Net Assets |
Temporarily Restricted Net Assets |
Permanently Restricted Net Assets |
|
Public support |
|||
Contributions |
214000 |
82000 |
|
Contribution interest |
3400 |
||
Revenue |
|||
Membership dues |
34000 |
||
Investment income |
5100 (17000*30%) |
11900 (17000*70%) |
|
Net assets released from restriction |
80400 (24000+(308000-254000)+2400) |
(80400) |
|
Total public support and revenue |
333500 |
16900 |
|
Expenses |
|||
Program service expenses cure disease |
|||
Salaries |
25500 ((84000*25%)+(9000*50%)) |
||
Depreciation |
19200 (24000*80%) |
||
Supplies |
97000 |
||
Total |
141700 |
0 |
0 |
Supporting service expenses– General and administrative |
|||
Salaries |
42000 (84000*50%) |
||
Depreciation |
2400 (24000*10%) |
||
Total |
44400 |
0 |
0 |
Fundraising |
|||
Salaries |
25500 ((84000*25%)+(9000*50%)) |
||
Advertising |
2400 |
||
Depreciation |
2400 (24000*10%) |
||
Total |
30300 |
0 |
0 |
Total expenses |
216400 |
0 |
0 |
Change in net assets |
117100 |
16900 |
0 |
Net assets Beginning of year |
404000 |
204000 |
104000 |
Net assets End of year |
521100 |
220900 |
104000 |
Statement of Financial Position
Assets |
||
Cash (712000+214000-84000-(308000-254000)+34000+14000+17000-2400-97000) |
753600 |
|
Pledge receivable (82000+3400) |
85400 |
|
Equipment |
308000 |
|
Accumulated depreciation |
24000 |
284000 |
Total assets |
1123000 |
|
Liabilities |
||
Salaries payable |
9000 |
|
Notes payable |
254000 |
|
Donated amount |
14000 |
|
Total liabilities |
227000 |
|
Net assets |
||
Unrestricted |
521100 |
|
Temporarily restricted |
220900 |
|
Permanently restricted |
104000 |
|
Total net assets |
846000 |
|
Total liabilities and net assets |
1123000 |
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