The following transactions of Beltville College transpired during 2020. The funds necessary are the Endowment Fund, the Annuity Fund, the Plant Fund—Unexpended, the Plant Fund—Investment in Plant, the Loan Fund, the Unrestricted Current Fund, and the Restricted Current Fund.
1. A gift of $10,000 was received from Carl Brown. The principal was to be held intact and the income to be used for any purpose designated by the governing board.
2. David Gross donated $20,000. The principal was to be held intact and the income to be used for scholarships for worthy students.
3. Roxanne Norton donated $30,000, of which the principal was to remain intact while the interest was to be used for student loans. All income is to be relent; all losses from loans are to be charged against income.
4. A gift of $205,000 was received from Brian Carr. Semiannual payments of $10,000 are to be made to the donor during his lifetime. On his death the fund is to be used to purchase or construct a students’ residence. Mr. Carr has a life expectancy of five years and investments are expected to earn 8% annually.
5. Kathy Jackson donated 1,000 shares of BIM stock, which had a market value of $150 per share on that date. All income received from the shares is to be held intact and the shares cannot be held for more than five years. Once the board sells the shares, all the proceeds are to be used to build a student hospital.
6. The assets of the Brown and Gross funds were consolidated into a pooled investment account by the governing board (in proportion to the principal accounts). Electric Power Bonds worth $30,000 were purchased. The 12% interest was payable on January 1 and July 1.
7. The Norton Fund cash is used to purchase Cravit Company 10% bonds at par for $30,000. January 1 and July 1 are the interest dates. 8. With the cash from the Carr Fund, $200,000 of 8% U.S. Treasury notes was purchased at par. The interest dates are January 1 and July 1.
9. The interest was received on all bonds and notes and was transferred to the proper funds. Dividends of $4,000 were received from BIM stock.
10. The stipulated payment is made to Mr. Carr from the Endowment Fund.
11. Electric Power Company bonds bought at par value for $20,000 are sold at 102. The gain is added to the principal.
12. A $300 student loan was made from the Norton Fund.
13. A notice of Brian Carr’s death is received. There is no liability to his estate.
14. The Gross Scholarship Fund awards a $200 scholarship.
15. $200,000 par of U.S. Treasury notes are sold for $206,000. December 31
16. Interest on bonds is received.
17. $100 of principal and $5 of interest were repaid on the student loan.
18. A building was purchased for $250,000 using the funds available from the Carr gift. The residence hall will have a 20-year mortgage payable to account for the balance.
Using the following format, record the journal entries necessary for each event.
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