Question

Jefferson Animal Rescue is a private non-profit clinic and shelter for abandoned domesticated animals, chiefly dogs, and cats. At the end of 2014, the organization had the following account balances:

Debits Credits Pledges receivables $3,500 Cash $25,000 Land buildings& equipment $41,000 Supplies inventory $4,000 Accounts Payable $5,800 Accrued wages payables $500 Accumulated depreciation $19,300 Note payable to bank $25,000 Net assets-temporarily restricted: For use in KDAC program $2,500 For purchase of capital assets $7,200 Unrestricted net assets $13,200 Total $73,500 $73,500

The following took place during 2017:

1. Additional supplies were purchased on account in the amount of $18,000.

2. Unconditional (and unrestricted) pledges of support were received totaling $95,000. In light of the declining economy, 4 percent is expected to be uncollectible. The remainder is expected to be collected in 2017.

3. Supplies used for animal care amounted to $16,700.

4. Payments made on accounts payable amounted to $17,800.

5. Cash collected from pledges totaled $90,500.

6. Salaries were paid in the amount of $47,500. Included in this amount is the accrued wages payable at the end of 2016. (The portion of wages expense attributable to administrative expense is $15,000, and fundraising expense is $2,000. The remainder is for animal care.)

7. Jefferson Animal rescue entered an agreement with KDAC, Channel 7 News, to find more homes for shelter pets. This special adoption program highlights a shelter animal in need of a home on the evening news the first Thursday of each month. The program was initially funded by a restricted gift. During 2017, Jefferson Animal Rescue paid $1,800 ($150 per month) for the production of the monthly videos. In December 2017, the original donor unconditionally pledges to support the project for an additional 20 months by promising to pay $3,600 in January 2018 (all of this is expected to be collectible).

8. The shelter´s building was partially financed by a banknote with an annual interest rate of 6 percent. Interest totaling $1,500 was paid during 2017. Interest is displayed as other changes in the statement of activities.

9. Animal medical equipment was purchased during the year in the amount of $5,200. Funding came from an especial capital campaign conducted in 2016. Additional information includes

10. Depreciation for the year amounted to $6,000 (The portion of depreciation expense attributable to administrative is $2,000, and the remainder is related to animal care.)

11. Unpaid wages relating to the final week of the year totaled $660 (all animal care).

Using the information above and the excel template provided:

a. Prepare the journal entries and post entries to the T- accounts.

b. Prepare closing entries

c. Prepare a Statement of Activities, Statement of Financial Position, and Statement of Cash Flows for the year ending December 31, 2017.

Answer 1