Accountant Forums


Reply
Thread Tools

Two nonprofit accounting questions - non-cash donations and fixed assets

 
 
Bill
Guest
Posts: n/a
Thanked:
 
      09-04-2003, 12:54 AM
I am updating the accounting records of a 4 year old church.
Regarding non-cash donations, the giver's account is credited, but
should the debit be to the nature of the gift? Example, paper or
pens, to office supplies? Or, cost of a cell phone, to phone expense?
These items are in a temporary asset account right now.

On fixed assets, I'm capitalizing items like chairs and tables, etc.
I want to have a $ 500 minimum on these items, except when we buy so
many. But an item like musical bells for just under $500, I hesitate
to capitalize these, but I also don't want to have a policy then have
a number of exceptions to it. Television under $500 or DVD players,
VCR's, expense. Anyone have a good benchmark I'm missing here?

Thanks for your help!!
 
Reply With Quote
 
 
 
 
Chris Luper
Guest
Posts: n/a
Thanked:
 
      09-04-2003, 01:01 PM
>I am updating the accounting records of a 4 year old church.
>Regarding non-cash donations, the giver's account is credited, but
>should the debit be to the nature of the gift? Example, paper or
>pens, to office supplies? Or, cost of a cell phone, to phone expense?
> These items are in a temporary asset account right now.


paper and pens: office expense.

cost of cell phone: should be a prepaid until phone time is used, at which
point it is phone expense.

>On fixed assets, I'm capitalizing items like chairs and tables, etc.
>I want to have a $ 500 minimum on these items, except when we buy so
>many. But an item like musical bells for just under $500, I hesitate
>to capitalize these, but I also don't want to have a policy then have
>a number of exceptions to it. Television under $500 or DVD players,
>VCR's, expense. Anyone have a good benchmark I'm missing here?
>


It really depends on the size of the non-profit what your materiality
considerations should be, but I would have a hard time expensing the purchase
of a television.
 
Reply With Quote
 
 
 
 
Janice Davis
Guest
Posts: n/a
Thanked:
 
      09-04-2003, 07:00 PM

"Chris Luper" <(E-Mail Removed)> wrote in message
news:(E-Mail Removed)...
> >I am updating the accounting records of a 4 year old church.
> >Regarding non-cash donations, the giver's account is credited, but
> >should the debit be to the nature of the gift? Example, paper or
> >pens, to office supplies? Or, cost of a cell phone, to phone expense?
> > These items are in a temporary asset account right now.

>
> paper and pens: office expense.


How is this an expense if these items are donated?

> cost of cell phone: should be a prepaid until phone time is used, at

which
> point it is phone expense.


Again I think this cell phone is a donated item. At least that is the way
Bill stated it.



 
Reply With Quote
 
Bill
Guest
Posts: n/a
Thanked:
 
      09-04-2003, 08:39 PM
"Janice Davis" <(E-Mail Removed)> wrote in message news:<mZL5b.20877$j26.20764@lakeread02>...
> "Chris Luper" <(E-Mail Removed)> wrote in message
> news:(E-Mail Removed)...
> > >I am updating the accounting records of a 4 year old church.
> > >Regarding non-cash donations, the giver's account is credited, but
> > >should the debit be to the nature of the gift? Example, paper or
> > >pens, to office supplies? Or, cost of a cell phone, to phone expense?
> > > These items are in a temporary asset account right now.

> >
> > paper and pens: office expense.

>
> How is this an expense if these items are donated?
>
> > cost of cell phone: should be a prepaid until phone time is used, at

> which
> > point it is phone expense.

>
> Again I think this cell phone is a donated item. At least that is the way
> Bill stated it.


In my way of thinking, the expense offsets the credit to the giver's
record (and is income to the church.)
At year end, I'll reclass these items to the appropriate expense or
asset accounts.

I'll capitalize the tv's for three years, I agree.
 
Reply With Quote
 
Bill Lentz
Guest
Posts: n/a
Thanked:
 
      09-04-2003, 08:40 PM
On Thu, 4 Sep 2003 14:00:36 -0500, "Janice Davis" <(E-Mail Removed)>
wrote:

>
>"Chris Luper" <(E-Mail Removed)> wrote in message
>news:(E-Mail Removed)...
>> >I am updating the accounting records of a 4 year old church.
>> >Regarding non-cash donations, the giver's account is credited, but
>> >should the debit be to the nature of the gift? Example, paper or
>> >pens, to office supplies? Or, cost of a cell phone, to phone expense?
>> > These items are in a temporary asset account right now.

>>
>> paper and pens: office expense.

>
>How is this an expense if these items are donated?
>


Not for profits frequently record donated goods and services as an "In
and Out" transaction
 
Reply With Quote
 
Ab
Guest
Posts: n/a
Thanked:
 
      09-04-2003, 10:58 PM
The entry is a debit to an expense or asset and a credit to revenue.
Donated revenue and expense are reported in two lines and they show
the sam balance.

Hope this helps
Ab


"Janice Davis" <(E-Mail Removed)> wrote in message news:<mZL5b.20877$j26.20764@lakeread02>...
> "Chris Luper" <(E-Mail Removed)> wrote in message
> news:(E-Mail Removed)...
> > >I am updating the accounting records of a 4 year old church.
> > >Regarding non-cash donations, the giver's account is credited, but
> > >should the debit be to the nature of the gift? Example, paper or
> > >pens, to office supplies? Or, cost of a cell phone, to phone expense?
> > > These items are in a temporary asset account right now.

> >
> > paper and pens: office expense.

>
> How is this an expense if these items are donated?
>
> > cost of cell phone: should be a prepaid until phone time is used, at

> which
> > point it is phone expense.

>
> Again I think this cell phone is a donated item. At least that is the way
> Bill stated it.

 
Reply With Quote
 
 
 
Reply

Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are On
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Another couple of nonprofit questions Bill Accounting 8 10-15-2003 01:46 AM
Re: Nonprofit Accounting for Indirect Cost and Pool SBT Bill Accounting 0 08-07-2003 11:57 PM
Re: Nonprofit Accounting for Indirect Cost and Pool Ima Goodlay Accounting 0 08-07-2003 02:35 PM
RE: Nonprofit Accounting for Indirect Cost and Pool Alvin Valverde Accounting 2 08-07-2003 03:19 AM
Re: Nonprofit Accounting for Indirect Cost and Pool Ron Todd Accounting 0 08-04-2003 08:43 PM


All times are GMT. The time now is 12:40 PM.
Posts in this forum do not constitute the advice of AccountantForums.com or its members. Financial advice should always be taken from qualified advisors before committing to a financial decision.