Use the Following Information to Answer Questions

question 22

Multiple Choice

Use the following information to answer Questions
Previously a local charity received a $1 million gift, the income from which was restricted to support activities for senior citizens.During the current year the endowment earned $40,000 of interest revenues, of which the charity designated $30,000 to support senior citizen activities.
-Cedar City has a permanent fund that reported current year investment earnings realized and unrealized of $80,000.The endowment principal is $800,000 and the city council has adopted a policy of considering only the inflation-adjusted rate of return to be available for transfer to the recipient fund.During the current year the Council declared the inflation-adjusted rate of return to be 8%.How much revenue would be recognized in the permanent fund?

• A)$ 0.
• B)$ 64,000.
• C)$ 80,000.
• D)Unable to determine.

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Definitions:

Backlash

The gapping or play between mating gear teeth usually measured with thickness gauges or a dial indicator.

Fatigue-Type Failures

Failures in materials or components that occur due to repetitive stress or strain over time, leading to cracks or breaks.

Gear Components

The individual parts that make up a gear system, including gears, shafts, bearings, and others, which transmit power and motion.

Spalled Tooth Surfaces

A condition where the surface of gear teeth becomes pitted or flaked off, usually due to fatigue, excessive loading, or material defects.