1. Classification of Revenues/Support and Expenses.For each of the independent transactions listed below, indicate which ofthe listed revenue or contribution classifications apply by choosingone or more of the letters from the listed items. Choose all that apply.

Transaction

1. A museum gift shop sold prints of famous paintings.
2. At the end of the year a donor agreed to contribute $400,000 to alocal artists’ fund if the museum raised a matching amount in the firstquarter of the upcoming year.
3. A registered nurse volunteered 10 hours a week to a local agency for disabled persons.
4. A donor contributed $1 million to a not-for-prof it hospital for a new clinic.
5. An NFP art association hosted its annual art exhibition for the association’s major contributors.
6. A donor contributed securities valued at $10 million to bepermanently invested. Earnings thereon are stipulated by the donor to beused for eye research.
7. A local computer store donated computers for children’s use at an NFP hands-on children’s museum.
8. A local PTA received cash contributions of $2,000 to be used for its operating activities.

Revenue and Contribution Classifications

1. Revenue
2. Contributions – Unrestricted
3. Contributions – Temporarily Restricted
4. Contribution – Permanently Restricted
5. None of the above.

2. Recording and Reporting Transactions. INVOLVE wasincorporated as a not-for-prof it voluntary health and welfareorganization on January 1, 2017. During the fiscal year ended December31, 2017, the following transactions occurred.

• A business donated rent-free office space to the organization that would normally rent for $35,000 a year.
• A fund drive raised $185,000 in cash and $100,000 in pledges thatwill be paid within one year. A state government grant of $150,000 wasreceived for program operating costs related to public health eduction.
• Salaries and fringe benefits paid during the year amounted to$208,560. At year-end, an additional $16,000 of salaries and fringebenefits were accrued.
• A donor pledged $100,000 for construction of a new building payableover the following five fiscal years, commencing in 2019. The discountedvalue of the pledge is expected to be $94,260. Office equipment waspurchased for $12,000. The useful life of the equipment is estimated tobe five years. Office furniture with a fair value of $9,600 was donatedby a local office supply company. The furniture has an estimated usefullife of 10 years. Furniture and equipment are considered unrestrictednet assets by INVOLVE.
• Telephone expense for the year was $5,200, printing and postageexpense was $12,000 for the year, utilities for the year were $8,300,and supplies expense was $4,300 for the year. At year-end, an immaterialamount of supplies remained on hand and the balance in accounts payablewas $3,600.
• Volunteers contributed $15,000 of time to help with answering thephones, mailing materials, and various other clerical activities.
• It is estimated that 90 percent all of the pledges made for the 2018year will be collected. Depreciation expense is recorded for the fullyear on the assets recorded in item 5.
• Salaries and wages were allocated to program services and supportservices in the following percentages: public health education, 35percent; community service, 30 percent; management and general, 20percent; and fund-raising, 15 percent. All other expenses were allocatedin the following percentages: public health education, 35 percent;community service, 20 percent; management and general, 25 percent; andfund- raising, 20 percent.
• Net assets were released to reflect satisfaction of state grantrequirements that the grant resources be used for program purposes.
• All nominal accounts were closed to the appropriate net asset accounts.

Using this information

1. Make all necessary journal entries to record these transactions.Expense transactions should be initially recorded by objectclassification; in entry 10 expenses will be allocated to functions.
2. Prepare a statement of activities for the year ended December 31, 2017.
3. Prepare a statement of financial position for the year ended December 31, 2017.
4. Prepare a statement of cash flows for the year ended December 31, 2017.
5. Prepare a statement of functional expenses for the year ended December 31, 2017.

3. Various Unrelated Transactions. Following are several unrelated transactions involving a university.

• In fiscal year 2017, the university was notified by the federalgovernment that in 2018 it would receive a $600,000 grant for wetlandsresearch.
• The university received a $600,000 endowment.
• For the fiscal year, the university recorded $3,500,000 in tuition and fees revenue. Cash refunds of $325,000 were given.
• The university provided $12,600 in tuition waivers for students with outstanding academic performance.
• During the year, the university constructed a new street, to allowfor the expansion of its student housing efforts. The cost of the streetwas $1,980,000.
• The biology department spent $25,000 on wetland research.
• At year-end, $2,670 of estimated uncollectible tuition and fees was recorded.

Using this information

1. Prepare journal entries to record the foregoing transactions, assuming the university is a private institution.
2. Prepare journal entries to record the foregoing transactions, assuming the university is a public institution.

4. Financial Statements – Public College. The following balances come from the trial balance of Wilson State College as of the end of the 2017 fiscal year.

Using this information

1. Prepare a statement of revenues, expenses, and changes in netposition for the year ended June 30, 2017, in good form. SeeIllustrations 15­2 and 7­6; however, display expenses using functionalclassifications as shown in Illustration 15­6.
2. Prepare a statement of net position as of June 30, 2017, in goodform. For the period, net position restricted for capital projectsincreased by $3,000, and net position restricted for debt serviceincreased by $150; all bonded debt relates to capital assets. SeeIllustration 15­1.
3. Prepare a statement of cash flows for the year ended June 30, 2017.Information on changes in assets and liabilities is as follows: AccountsReceivable (net) increased by $2,551; Due from State decreased by$14,842; Inventories increased by $23; Accounts Payable and AccruedLiabilities increased by $1,962; and Unearned Revenue decreased by$1,763. See Illustration 15­3