Question

The American Youths for the Future received an endowment of $100,000 to promote voting among young people for future presidential elections. The journal entry to close this contribution account at the end of the year is ________.

Answer 1

The journal entry to close the contribution account of the American Youths for the Future's $100,000 endowment to promote voting is typically a debit to the contribution account and a credit to an equity or fund balance account.

Step-by-step explanation:

The journal entry to close the contribution account for the American Youths for the Future, which received a endowment of $100,000 to promote voting among young people, at the end of the year would typically involve debiting the contribution account and crediting an appropriate equity or fund balance account.

The exact nature of the entry can vary based on the accounting standards being followed and the specific structure of the organization's chart of accounts.

However, a common entry would be:

• Debit: Contributions - Endowment Fund (to decrease the balance)
• Credit: Endowment Fund Balance or Equity (to increase the balance accordingly)

This accounting entry ensures that the contribution is properly reflected in the organization's financial statements for the year.

The ultimate goal of such funding is to engage young voters and encourage higher turnout in elections, capitalizing on trends such as the historically significant youth participation in the 2008 and 2020 elections.