The Basil Society, a nongovernmental not-for-profit organization, receives unconditional pledges which will be collected over a length of time longer than one year. How should Basil Society report these unconditional pledges?

(A) As pledges receivable, valued at their present values.

(B) As pledges receivable, valued at the amount pledged.

(C) As long-term pledges receivable, valued at the expected actual collection amount.

(D) As deferred revenue, valued at present value

Question

Business

Kallie

4 March, 20:48

The Basil Society, a nongovernmental not-for-profit organization, receives unconditional pledges which will be collected over a length of time longer than one year. How should Basil Society report these unconditional pledges?

(A) As pledges receivable, valued at their present values.

(B) As pledges receivable, valued at the amount pledged.

(C) As long-term pledges receivable, valued at the expected actual collection amount.

(D) As deferred revenue, valued at present value

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Answers (1)

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Kyla Ortega · Answer 1

The answer is option A

Explanation:

The basil society report these unconditional pledges as pledges receivable, valued at their present values.

The basil society, a non governmental not-for-profit organization, receives unconditional pledges which will be collected over a length of time longer than one year as the pledges are receivable and valued at their present values.

The promise should be reported as contributions or pledges receivable for a specific period. It is then treated as an increase in net assets with donor imposed restrictions. The fair value of unconditional promises to give cash expected are collected in 1 year or more is the present value of the estimated future cash flows.