Maple City has a permanent fund that reported current-year investment earnings (realized and unrealized) of $80,000. The endowment principal is $800,000 and the city council has adopted a policy of considering only the inflation-adjusted rate of return to be available for transfer to the recipient fund. During the current year the council declared the inflation-adjusted rate of return to be 8 percent. How much revenue would be recognized in the permanent fund?
A) $ 0.
B) $ 64,000.
C) $ 80,000.
D) Insufficient information to determine.

Question

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The Answer of Maple City has a permanent fund that reported current-year investment earnings (realized and unrealized) of $80,000. The endowment principal is $800,000 and the city council has adopted a policy of considering only the inflation-adjusted rate of return to be available for transfer to the recipient fund. During the current year the council declared the inflation-adjusted rate of return to be 8 percent. How much revenue would be recognized in the permanent fund?
A) $ 0.
B) $ 64,000.
C) $ 80,000.
D) Insufficient information to determine.

Maple City Has a Permanent Fund That Reported Current-Year Investment