Tuition and Fees for Northern University Were Assessed at $22,000,000

question 41

Short Answer

Tuition and fees for Northern University were assessed at $22,000,000. $ 1,600,000 of the amount due from students was later reduced by need based scholarships. Graduate assistantships and work-study stipends reduced the amounts collectible from student by an additional $ 1,000,000.
-What is the journal entry to record the scholarship allowances?

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Definitions:

Coverdell Education Savings Account

A tax-advantaged saving account designed to pay for education expenses, from primary to higher education.

AGI

AGI (Adjusted Gross Income) is a measure of income calculated from your gross income and allows certain deductions to lower your taxable income, such as contributions to retirement accounts and student loan interest.

CESA Contribution

Contributions made to a Coverdell Education Savings Account that are designated for financing educational expenses.

Annuity Contract

A financial product sold by financial institutions that offers fixed or variable payments to an individual over time, often used for retirement savings.