A: Temporarily restricted revenues of $5,000.
B: $0 until the pledge is received.
C: Temporarily restricted revenues valued at present value of an ordinary annuity for 5 periods.
D: Temporarily restricted revenues valued at present value of an annuity due for 5 periods.

Answer is D.

 

Here's another similar question:

 

On December 31, 2008, Hope Haven, a voluntary health and welfare organization, received a pledge from a donor who stipulated that $1,000 would be given to the organization each year for the next 5 years, starting on December 31, 2008.  Present value factors at 6% for 5 periods are presented below.

Present value of an ordinary annuity for 5 periods at 6%	4.21236
Present value of an annuity due for 5 periods at 6%	4.46511

For the year ended December 31, 2008, Hope Haven should report, on its statement of activities,

Answers

A: Unrestricted revenues of $5,000.
B: Temporarily restricted revenues of $4,465.
C: Unrestricted revenues of $4,465.
D: Temporarily restricted revenues of $4,212.

 

The answer is D.

 

What's going on?  These questions seem to contradict each other.  Both questions have essentially the same set of facts, but the first tells you to use annuity due (as the first payment is on Dec 31, 08), but the second tells you to use ordinary annuity.  Do you think the second question is a typo, and they meant to say December 31, 2009?