A voluntary health and welfare organization received $200,000 of pledges from donors on February 15,20X9.The donors did not place either time or use restrictions on the amount pledged.The governing board estimated that 10 percent of the pledges would be uncollectible.During the remainder of fiscal 20X9,cash received from pledges amounted to $184,000.For the year ended June 30,20X9,what amount should the voluntary health and welfare organization report as Contributions-Unrestricted?

Question

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The organization received $200,000 of pledges from donors on February 15, 20X9. Since the donors did not place any restrictions on the pledges, the entire amount is considered Contributions-Unrestricted. However, the governing board estimated that 10% of the pledges would be uncollectible, which means that $20,000 ($200,000 x 10%) would not be collected. Therefore, the total amount of Contributions-Unrestricted is $180,000 ($200,000 - $20,000). During the remainder of fiscal 20X9, the organization received $184,000 cash from the pledges, which is less than the total amount pledged. Therefore, the amount of Contributions-Unrestricted that should be reported for the year ended June 30, 20X9 is $184,000.

A Voluntary Health and Welfare Organization Received $200,000 of Pledges