citizen group raised funds to establish an endowment for the Eastville City Library. Under the terms of the trust agreement, the principal must be maintained, but the earnings of the fund are to be used to purchase database and periodical subscriptions for the library. A preclosing trial balance of the library permanent fund follows: Trial Balance—December 31, 2020 Debits Credits Cash $ 15,000 Investments 544,000 Additions to permanent endowments $ 529,500 Investment income 67,500 Expenditures—subscriptions
citizen group raised funds to establish an endowment for the Eastville City Library. Under the terms of the trust agreement, the principal must be maintained, but the earnings of the fund are to be used to purchase database and periodical subscriptions for the library. A preclosing trial balance of the library permanent fund follows: Trial Balance—December 31, 2020 Debits Credits Cash $ 15,000 Investments 544,000 Additions to permanent endowments $ 529,500 Investment income 67,500 Expenditures—subscriptions
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 26E: Sinking Funds Entries The following information is available concerning Nunan Corporations sinking...
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A citizen group raised funds to establish an endowment for the Eastville City Library. Under the terms of the trust agreement, the principal must be maintained, but the earnings of the fund are to be used to purchase database and periodical subscriptions for the library. A preclosing
Trial Balance—December 31, 2020 | Debits | Credits | ||||||
Cash | $ | 15,000 | ||||||
Investments | 544,000 | |||||||
Additions to permanent endowments | $ | 529,500 | ||||||
Investment income | 67,500 | |||||||
Expenditures—subscriptions | 52,500 | |||||||
Net increase in fair value of investments | 14,500 | |||||||
Accrued interest receivable | 5,250 | |||||||
Accounts payable | 5,250 | |||||||
$ | 616,750 | $ | 616,750 | |||||
Required:
a. Prepare any closing entries necessary at year-end.
b. Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the library permanent fund.
c. Prepare a balance sheet for the Library Permanent Fund (Use Restricted to Subscriptions for any spendable fund balance).
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