Native Art Museum, a Not-For-Profit Entity That Elects Not to Capitalize

question 38

Multiple Choice

Native Art Museum, a not-for-profit entity that elects not to capitalize its collection items, purchased for $10,000 a wonderful totem pole for display near the door of the museum. As a result of this transaction, which of the following entries should be made?

• A) Debit Collection items $10,000; Credit Cash $10,000.
• B) Debit Collection expense $10,000; Credit Cash $10,000.
• C) Debit Unrestricted net assets $10,000; Credit Cash $10,000.
• D) No entry is required.

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Definitions:

Responsibility

The obligation to carry out duties and make decisions within a role, organization, or towards society.

Servant Leadership

A leadership philosophy that focuses on serving others, prioritizing the well-being and development of team members and stakeholders above self-interest.

Authentic Leadership

A leadership style that is genuine and transparent, with leaders being true to themselves and their values while fostering trust.

Ethical Leadership

Leadership that demonstrates, promotes, and integrates ethical principles both personally and organizationally, to guide behaviors and decision-making.