Question

The Ridgeway School District Parent-Teacher Association sponsored a bazaar to raise funds for the Special Education Project. Direct costs of $6,000, not considered peripheral or incidental in nature, incurred for this event were paid in cash. The event yielded cash contributions of $20,000. What is (are) the required journal entry(ies)?

Answer 1

The journal entries for the Ridgeway School District Parent-Teacher Association bazaar event would be to debit cash and credit fundraising revenue for the amount received and to debit fundraising expenses and credit cash for the expenses paid.

Step-by-step explanation:

The question involves recording a financial transaction for a bazaar event that raised funds for a Special Education Project, within the field of accounting under Business. The required journal entries to record the event's results would look like this:

1. Debit Cash $20,000
2. Credit Fundraising Revenue $20,000
3. Debit Fundraising Expenses $6,000
4. Credit Cash $6,000

The entries show that the organization received cash from the event and recognized it as revenue, and also paid cash for the expenses associated directly with hosting the event.