A not-for-profit entity (Charity A) raises money for other charitable entities. Charity A receives $10,000 to distribute to Charity B.Assume that the donor retains the right to revoke or redirect the gift.Prepare the journal entries for Charity A and Charity B. The entries should be for the gift when received by Charity A, and when the gift is distributed for Charity B.
What will be an ideal response?
| Charity A, upon receipt: | ||
| Cash | $10,000 | |
| Refundable Advance from Donor | $10,000 | |
| Charity B, upon receipt by Charity A: | ||
| Contribution Receivable | 10,000 | |
| Contribution Revenue | 10,000 | |
| Charity A, when gift is distributed: | ||
| Refundable Advance from Donor | 10,000 | |
| Cash | 10,000 | |
| Charity B, when gift is received from Charity A: | ||
| Cash | 10,000 | |
| Contribution Receivable | 10,000 | |
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