A private,not-for-profit hospital received a cash contribution of $100,000 from Samantha Hicks on November 14,2008.Ms.Hicks specified the money be used to acquire equipment.On December 31,2008,the hospital had not expended any of Ms.Hicks' contribution.On the statement of changes in net assets for the year ended December 31,2008,the hospital should report the contribution as a $100,000 increase in

Question

Quizplus · Accepted Answer

The contribution from Samantha Hicks is restricted to be used for the acquisition of equipment, making it a temporarily restricted net asset. Since the hospital has not yet used any of the contribution by December 31, 2008, it will remain classified as temporarily restricted until the restriction has been fulfilled or lifted. Therefore, the $100,000 should be reported as an increase in temporarily restricted net assets on the statement of changes in net assets for the year ended December 31, 2008.

A Private,not-For-Profit Hospital Received a Cash Contribution of $100,000 from Samantha