The Following Are Selected Transactions for HELP-ON-US (HOU), an NFPO

question 27

Essay

The following are selected transactions for HELP-ON-US (HOU), an NFPO for 2020. HOU uses the restricted fund method of accounting for contributions. HOU has an operating fund, a capital fund and an endowment fund.
On January 1, the organization purchased fixed assets at a cost of $10,000. The assets were estimated to have a useful life of 5 years with no residual value. Straight-line amortization is used.
Assuming that the assets were purchased from a restricted contribution that was made on January 1, 2020 in the amount of $11,000, prepare the required journal entries for 2020, indicating the fund or funds to be used.

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Definitions:

Stimulus

An environmental condition that elicits a response.

Inborn Responses

Behavioral reactions that are genetically programmed, requiring no prior experience or learning to occur.

Specific Stimuli

Particular environmental or internal triggers that elicit responses from organisms or psychological systems.

Prenatal Development

The process of growth and development within the womb from conception until birth.