Wilson Center is a private not-for-profit voluntary health and welfare entity. During 2017, it received unrestricted pledges of $675,000, 70 percent of which were payable in 2017, with the remainder payable in 2018 (for use in 2018). Officials estimate that 12 percent of all pledges will be uncollectible.
a. How much should Wilson Center report as contribution revenue for 2017? (Ignore time value calculations.)
b. In addition, a local social worker, earning $23 per hour working for the state government, contributed 610 hours of time to Wilson Center at no charge. Without these donated services, the organization would have hired an additional staff person. How should Wilson Center record the contributed service?
| a) For revenue calculation journal entries whould be use | ||||
| Particulars | Debit | credit | ||
| contribution receivable (675000*70%) | $ 4,72,500.00 | |||
| allowance for uncollectable pledges (472500*12%) | $ 56,700.00 | |||
| unrestricted net assets-contribution | $ 4,15,800.00 | |||
| (to record contribution receivable through pledge) | ||||
| Form the journal entries the amount of unrestricted net assets from contribution | ||||
| calculated as $ 415800 | ||||
| b) | ||||
| particulars | Debit | Credit | ||
| salary exp (23*610 hrs) | $ 14,030.00 | |||
| unrestricted net assets- contribution | $ 14,030.00 | |||
| (record the contribution by social worker) | ||||
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