An unconditional pledge of support received by a private college is recorded as revenue when the promise to give is unconditional.

Question

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According to generally accepted accounting principles (GAAP), an unconditional pledge of support is recorded as revenue when the promise to give is unconditional. This means that the donor has pledged to give a certain amount of money to the college without any restrictions or conditions attached to the gift. Once the promise is made, the college can record the amount as revenue on its financial statements. However, if the pledge is conditional in any way, it cannot be recorded as revenue until the condition is met.

An Unconditional Pledge of Support Received by a Private College