A not-for-profit hospital received a donor-restricted contribution of $10 million, which is used to purchase new equipment. It estimates that the useful life of the equipment will be 10 years with no salvage value. In the year of the contribution, the hospital should recognize
a. Depreciation of $1 million classified as an expense without donor restrictions
b. A capital expense of $10 million classified as an expense without donor restrictions
c. Depreciation of $1 million classified as an expense with donor restrictions
d. Net assets released from donor restriction of $1 million