should not fall below $70,000. The excess of expenses and losses over revenues would be shown as a reduction in unrestricted net assets. The investments are being managed by an outside firm, so any mid-year investment transactions would not be recorded directly by the not-for-profit. XYZ wouldrecord the dividends received and the ending investment value as reported by the management firm.FASB ASC 958-205-45-14, 958-205-45-17, and Glossary
41) On January 1, Read, a nongovernmental not-for-profit entity, received $20,000 and an unconditional promise of $20,000 for each of the next four calendar years to be paid on the first day of each year. The present value of an ordinary annuity for four years at a constant interest rate of 8%is 3.312. What amount of restricted net assets is reported in the year the promise was received?
42) On December 30 of the current year, Haber Co. leased a new machine from Gregg Corp. The following data relate to the lease transaction at the inception of the lease:Lease term 10 yearsAnnual rental payable at the end of each lease year $100,000Estimated life of machine 12 yearsImplicit interest rate 10%Present value of an annuity of $1 in advance for10 periods at 10% 6.76Present value of an annuity of $1 in arrears for10 periods at 10% 6.15Fair value of the machine $700,000