In the current year, the not-for-profit organization (NFP) How to Read Government Financial Reports received both cash of $1,000 and pledges of $2,000 to be used for teaching citizens how to read government financial reports. During the year the organization spent $1,500 teaching citizens to read financial statements. Assuming the NFP has a policy of spending its restricted resources first, in the current year what amount of contributions can be reclassified as without donor restrictions?

Question

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The NFP has a policy of spending its restricted resources first. The organization received $1,000 in cash and pledges of $2,000, for a total of $3,000 in restricted resources. The organization spent $1,500 teaching citizens to read financial statements, which is less than the amount of restricted resources available. Therefore, $1,000 of the restricted resources can be reclassified as without donor restrictions.

In the Current Year, the Not-For-Profit Organization (NFP) How to Read