The local school board received a donation of $1,000,000 to establish a scholarship fund for graduating students. The scholarship is accounted for in a Private-Purpose Trust Fund. The fund would report

Question

Quizplus · Accepted Answer

A Private-Purpose Trust Fund is established for a specific purpose other than providing benefits to individuals or organizations outside of the government. In this case, the purpose is to establish a scholarship fund for graduating students. The donation of $1,000,000 is an addition to the fund, which is reported as an increase in the fund balance. Therefore, the correct answer is A, additions of $1,000,000.

The Local School Board Received a Donation of $1,000,000 to Establish