An unconditional pledge of support is properly recorded as Temporarily Restricted Revenue at the time of the pledge. Changes in the present value of the receivable resulting from the passage of time is reported as:

Question

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FASB requires multiyear pledges to be recorded at the present value of the future collections. As time passes, the present value of the pledge receivable will increase. At the end of each accounting period the difference between the previously recorded revenue and the new present value is recorded as additional contribution revenue, not interest.

An Unconditional Pledge of Support Is Properly Recorded as Temporarily