For Each of the Following Unrelated Transactions,record the Journal Entry

question 5

Essay

For each of the following unrelated transactions,record the journal entry that would be made by a nongovernmental,not-for-profit organization involved in medical research.If no journal entry is recorded,explain why there is no journal entry.
a.The entity received $1,500 in cash contributions.Of that amount,$1,000 is to be used for medical research.
b.The entity received pledges of $700,000 for its endowment fund.All pledges will be collected next year.
c.The entity received donated services of $1,200 from medical researchers who helped with the entity's on-going drug development research.It also received $300 in donated services from students,who helped clean the research facilities.
d.The entity paid medical research operating expenses of $5,000 that were related to restricted net assets it had received in prior years.

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Definitions:

Anchoring

A cognitive bias that describes the human tendency to rely too heavily on the first piece of information offered when making decisions.

Overconfidence Effect

A psychological tendency where a person's personal assurance in their decisions exceeds the actual correctness of those decisions.

Prospect Theory

A behavioral economic theory that describes the way people choose between probabilistic alternatives that involve risk, where the probability of outcomes is uncertain.

Behavioral Economists

Economists who study the effects of psychological, cognitive, emotional, cultural, and social factors on economic decisions of individuals and institutions.