Union Seminary Uses the Fund Basis of Accounting for Internal

question 1

Essay

Union Seminary uses the fund basis of accounting for internal record keeping. Presented below is the fully adjusted 12/31/09 balance sheet for Union, prepared using funds and account groups. The following are fund descriptions:
• Operating Fund - the fund used for transactions not falling within the definition of other funds. There are no restrictions on these resources.
• Memorial Fund - Used to account for resources donated from outside parties for specific capital additions
• Endowment Fund - Assets received from an outside donor for permanent investment, only the earnings may be expended.
• Scholarship Fund - Cash set aside by the Seminary's governing board for use as scholarships and student aid.
• Fixed Assets Account Group - A record of the Seminary's fixed assets and long-term debt.
Required: Prepare a Statement of Financial Position following the guidelines provided in FASB Statements 116 and 117 for private not-for-profits and assuming Union does not classify plant assets as temporarily restricted.

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Definitions:

Possesses

To have or hold property, items, or qualities, indicating ownership or control over such.

Receive

The act of accepting or taking possession of something that has been given, sent, or awarded to someone.

Destination Contracts

Contracts specifying that the seller is responsible for the delivery of goods to a specific destination.

Seller

is a party that offers goods or services for sale to a buyer in exchange for payment or other consideration.