Funds to track restricted resources


In June 2013, the wealthy parents of a college sophomore pledge to donate $1.5 million to the college she attends, making payments of $0.5 million at the end of each of her remaining years at the school until her expected graduation in 2016. The college applies a discount rate of 3 percent. At that rate, the present value of $1 for three periods is $2.82861. What entry, if any, would be required to recognize the pledge? What entry(ies), if any, would be required to record the receipt of the first $0.5 million at the end of year 2013? Assume that the college uses separate funds to track restricted resources and indicate in which fund each entry is made.

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Accounting Basics: Funds to track restricted resources
Reference No:- TGS041049

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