Your Ask Joey ™ Answer

What is the journal entry to record a contribution of assets for a not-for-profit entity?

When a donor contributes assets (cash, equipment, car, etc.), the value of the donation is measured at fair-market-value (“FMV”).

Donations can either be restricted or unrestricted. As you can see in the example below, medical equipment was donated and the FMV was $25,000.

For a donation with no restrictions (i.e. unrestricted), the NFP entity would debit contributed asset for $25,000 and credit contribution revenue for $25,000.

For a restricted asset, the journal entry would be very similar except it would be recorded to accounts that were related to restricted use.


Back To All Questions

You might also be interested in...