A private,not-for-profit hospital expended $35,000 of temporarily restricted assets to acquire equipment.What account should be debited in the hospital's plant replacement and expansion fund as a result of the acquisition of the equipment?

Question

Quizplus · Accepted Answer

When temporarily restricted assets are expended for a specific purpose, such as acquiring equipment, the net assets released from such restrictions should be recorded in the appropriate fund. In this case, the net assets released should be debited to the plant replacement and expansion fund using the account Net Assets Released-Plant Acquisition.

A Private,not-For-Profit Hospital Expended $35,000 of Temporarily Restricted Assets to Acquire