Greene County Historical museum, a not-for-profit entity that capitalizes its collection items, received a gift of several Civil War artifacts to be used for display and research.The donor found these items while cleaning out the closet of an old house.The fair value is hard to estimate but a dealer in these types of artifacts estimates their value at $2,000.The entry to record this donation is

Question

Quizplus · Accepted Answer

The museum should record the donation at its estimated fair value of $2,000 as a debit to collection items and a credit to contributions revenue. This will increase the value of the museum's collection and recognize the support received from the donor. Choice A is incorrect because collection expenses are unrelated to this transaction. Choice C is incorrect because the cost to the donor is not relevant to the museum's accounting. Choice D is incorrect because the value of the items is estimated and requires recording at an estimated fair value.

Greene County Historical Museum, a Not-For-Profit Entity That Capitalizes Its