A donor gave equipment valued at $60,000 at the beginning of 2015 to a private not-for-profit organization. The equipment had a 10-year life and depreciation of $6,000 was charged during 2015. At the end of the year,the net assets to be reported in unrestricted net assets related to this equipment would be:

Question

Quizplus · Accepted Answer

The net assets to be reported in unrestricted net assets related to this equipment would either be $54,000 or $0, depending upon the policy of the organization. If the organization has a policy of not including donated assets in its financial statements, then the net assets to be reported would be $0. On the other hand, if the organization has a policy of including donated assets in its financial statements, then the net assets to be reported would be $54,000 ($60,000 - $6,000).

A Donor Gave Equipment Valued at $60,000 at the Beginning