How would I do a journal entry.....A Humane Society conducted a fundraiser, the event raised 100,000 cash and 20,000 in pledges to be made after the end of year. Do I include or make a separate entry for the pledges, or leave it off?
Tara Farrell from USA
Tara Farrell, as per accounting rule, we will pass the journal entry of transaction. Because you have received cash for your donation project under fundraiser scheme. So, you have to pass only received cash's journal entry. You need not to pass the entry of $ 20,000 which is just in the form of pledges. With pledges, there is not any increase of your organisation's any asset. Second, you did not give anything as consideration. So, you can not claim for this.
Yes, if any donor has given his pledge in written form for paying some donation after sometime, it will become the income of your organisation. If you did not receive the $ 20,000, it will become your receivable income and following entry will pass.
Pledge Asset (Receivable) Debit
Pledge Income Credit