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    Journal Entries for Not for Profit Science Center for Children

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    Discovery Barn, a not-for-profit science center for children, received a contribution for $30,000 explicitly designated for the acquisition of computers. During the year it acquired $21,000 of computers, which it estimated to have a useful life of three years. It is the policy of the organization to charge an entire year's depreciation in the year of acquisition.

    Prepare all required journal entries, being certain to indicate the type of fund in which each entry would be made.

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    Solution Preview

    1. Contribution:

    Temporarily Restricted fund
    Cash $30,000
    Revenues from contribution $30,000
    Explanation: to record contribution for temporarily restricted fund
    When cash is disbursed for restricted purposes-
    Expense Account $30,000
    Cash $30,000

    Net Assets released from restricted fund-restricted fund ...

    Solution Summary

    The solution assists in preparing journal entries for not for Profit Science Center for Children.