In: Accounting
Although universities may be characterized by transactions
not typically engaged in by other types of entities,...
Although universities may be characterized by transactions
not typically engaged in by other types of entities, most can be
accounted for within the framework applicable to not-for-profit
organizations in general. (please use a chart)
College, a not-for-profit institution, engaged in the following
transactions during its fiscal year ending June 30, 2020. Prepare
appropriate journal entries, indicating the types of funds (by
restrictiveness) in which they would be recorded.
- The college collected $86,400,000 in student tuition. Of this
amount $6,000,000 was applicable to the summer semester, which ran
from June 1 to August 30, and $400,000 was applicable to the fall
semester that began the following September.
- It received a contribution of $1,000,000 in stocks and bonds to
establish an endowed chair in chemistry. Income from the chair must
be used to supplement the salary of a professor of chemistry.
- During the year, the chemistry chair endowment earned interest
and dividends of $50,000, all of which was used to supplement the
salary of the chair holder.
- The fair value of the investments of the chemistry chair
endowment declined by $80,000.
- Using funds restricted for this purpose, the college purchased
$150,000 of equipment for intercollegiate athletics.
Intercollegiate athletics is accounted for as an auxiliary
enterprise. The college charged depreciation of $30,000.
- The annual alumni campaign yielded $1,800,000 in pledges. The
college estimated that 2 percent would be uncollectible. During the
year the college collected $1,500,000 on the pledges.