During the year, a state-owned university received a $5 million gift.The donor specified that the principal of the gift must be held intact for 3 years, but the earnings from the gift can be used to support technology improvements in the College of Business.At the end of the 3 years, the donor together with the University President and the College Dean will decide how the $5 million gift can be used.The University will report the gift in what type of fund?

Question

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The donor specified that the principal must be held intact, which is typical of a permanent fund. The earnings from the gift can be used to support a specific purpose, which is also typical of a permanent fund. After 3 years, the donor and university officials will decide how to use the gift, which is consistent with a permanent fund.

During the Year, a State-Owned University Received a $5 Million