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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.

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