the amity community centre acc has decided that it will proceed with a capital campa 4374921

The Amity Community Centre (ACC) has decided that it will proceed with a capital campaign this year. The building that it uses is in dire need of major repair and the board of directors feels that this is a good time to expand by adding an extra floor, creating a gym, and upgrading the cafeteria. ACC uses the restricted fund method of accounting and has a separate capital asset fund. The fund is currently in a zero balance as the building is fully depreciated and the organization follows the policy of allocating depreciation to the capital asset fund. The other capital assets are immaterial. The plan calls for a $3.8-million expansion. In the current year, ACC has managed to collect pledges of $2 million in donations from large private investors; however, only $500,000 has actually been received. The balances are payable over a five-year period. The director of finance has also negotiated a $1-million interest-free loan from the government, payable over 4 years. The current market rate of interest is 4% for similar loans. The balance of $800,000 is still to be solicited from smaller donors. A key supplier of iron for construction has donated all the metal required, which is valued at approximately $50,000. Another supplier donated the labour of some skilled electricians valued at $25,000. The architect on the project is providing her services for free. She would normally charge $32,000 for this type of work. ACC has always relied on volunteers to solicit donations; however, given the large commitment for a capital campaign, ACC hired a professional fundraiser mandated to carry out the campaign as well as all the annual giving. Her annual salary is $100,000 and she required an assistant at $30,000 per year as well as part-time secretarial help at $10,000 per year. They will spend approximately 75% of their time on the capital campaign. Required -Prepare the journal entries that ACC would make for the above-mentioned transactions. -Prepare ACC’s statement of operations and the statement of financial position for the capital asset fund. View Solution:
The Amity Community Centre ACC has decided that it will

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