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In the current year, the City of Katerah earned $24,000 on the principal of a private-purpose trust fund but disbursed only $20,000.
-During the current year the private-purpose trust fund will recognize, related to the cash outflow:

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Use the following information to answer Questions 
In the current year, the City of Katerah earned $24,000 on the principal of a private-purpose trust fund but disbursed only $20,000.
-During the current year the private-purpose trust fund will recognize, related to the cash outflow:

Quizplus · Accepted Answer

The private-purpose trust fund will recognize a $20,000 deduction from net assets because it disbursed $20,000 during the year. The earnings of $24,000 are not fully disbursed, so only the amount actually disbursed is deducted from net assets.

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