On January 1, the Hawaii Cancer Institute has received a promise from the Obama Foundation to receive a building that the Foundation recently appraised at $200,000 but cost it only $125,000. The Institute promised to keep the building "permanently restricted," i.e., never to sell it and to use it only for its work in helping cancer patients?

After not receiving title by December 30, the Institute inquired as to the status of the promised building.  The Foundation stated that water damage to the building (from last year's flood) has permanently reduced the carrying value of the building to $100,000. The Foundation had initially hoped to set up a fund drive to help "clean up" the building? However, both parties have agreed that as of December 31, this fund drive would not materialize and the date to receive the building would remain unknown? How should the Institute now record the promised gift? 

Answer rating: 100% (QA)

Based on the given information the Hawaii Cancer Institute should record the promised gift as follow... View the full answer