Problem $12-2$: For purposes of external reporting, not$-$for$-$profits $-$ unlike governments in their governmental funds $-$ do not distinguish between plant and other types of resources. In $20$X$0,$ the Northwest Ballet Association $($NBA$),$ a not$-$for$-$profit performing arts organization, undertook a major capital campaig to fund a new theater, expected to cost $$10,000,000$ It was quickly able to raise $$6,000,000$ all of which was donor restricted. It borrowed the balance, issuing a$5$ year, $8\%$ term note for $$4,000,000$ During the year, the NBA broke ground on the project and incurred construction costs of$$ $$3,400,000$ it earned $$520,000$ in interest on investments. It incurred and paid $$320,000$ in interest on the note. In addition, as required by the note, it placed $$700,000$ in a reserve fund $($a specifally dedicated bank account$)$ for the repayment of the debt.$1.$ To show how these transactions would be reflected on the NBA's financial statements, prepare a December $31,20$X$0,$ statement of financial position and statement of activities. Assume that these were the only transactions in which the organization engaged and that that all available cash,$$ except that in the reserve fund, had been invested in short$-$term marketable securities$.$ Be sure to properly classify all resources as to whether they are restricted by donors or not.$2.$ comment briefly on whether the contributions from donors and the proceeds from the bonds should be reported as restricted by donors or not.$3.$ comment briefly on whether the $$700,000$ in the reserve fund should be reported as restricted by donors or not.$$