A donor pledged $500,000 to a not-for-profit hospital in 2008 to conduct medical research, conditional on the hospital raising $500,000 from other donors. The other donors met the condition in 2009. The donor transferred the funds to the hospital in 2009. In which year would the revenue be recognized?

Question

Quizplus · Accepted Answer

The revenue can only be recognized when the conditions of the pledge have been met, which in this case was in 2009 when the hospital raised $500,000 from other donors and the pledge was transferred to the hospital. Therefore, the revenue would be recognized in 2009.

A Donor Pledged $500,000 to a Not-For-Profit Hospital in 2008