A local civic organization gave the city government $15,000 cash to be used to pay the utility bills of persons whose incomes were below the poverty level.The city should account for the $15,000 gift in

Question

Quizplus · Accepted Answer

The $15,000 gift is given for a specific purpose of paying the utility bills of persons below the poverty level. Therefore, the best option for the city would be to account for it in a private-purpose trust fund. This type of fund is used to account for resources where the principal and income must be used for the benefit of specific individuals or organizations, in this case, those below the poverty level.

A Local Civic Organization Gave the City Government $15,000 Cash