A private,not-for-profit hospital received a donation of medicine from the Xengen Pharmaceutical Company on February 13,20X2.The cost of the medicine to the company was $34,000,and its market value was $76,000.Thirty percent of the medicine was used by the hospital during the year ended June 30,20X2.On the hospital's statement of operations for the year ended June 30,20X2,the contribution of medicine would increase operating revenues by:

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The correct answer is D) $76,000. In accounting for not-for-profit organizations, donated goods such as medicine are recorded at their fair market value at the time of donation. Therefore, the hospital would recognize $76,000 as an increase in operating revenues, which is the market value of the donated medicine.

A Private,not-For-Profit Hospital Received a Donation of Medicine from the Xengen