9 Case 4.1: Safe Place for Youth (SPY)

Safe Place for Youth (SPY) is a non-profit entity whose mission is to inspire, nurture, and empower the resilient human spirit of homeless youth by providing immediate and lasting solutions, one young person at a time.

Using the Excel Spreadsheet below, show how each transaction affects the organization’s assets, liabilities, or net assets. List the account name and amounts associated with each transaction and identify whether they are affected negatively (-) or positively (+). You may divide each transaction into several steps if you find it easier.

For the period FY 2019 (July 1, 2018 – June 30, 2019), the non-profit reported the following transactions:

1. On July 1, 2018, SPY received an unsolicited quote for general liability insurance coverage for FY 2019 of $14,390.
2. On August 1, 2018, SPY purchased $14,982 in computing equipment in cash. The new equipment is expected to have a useful life of three years and zero salvage value.
3. On August 15, 2018, SPY received donations of program supplies valued at $34,896. SPY will distribute $66,250 in supplies to program participants throughout the year.
4. On September 24, 2018, SPY hosted its annual fundraising gala event. The event raised $776,680 in unrestricted public support. Historically, 2.5 percent of all pledges have been uncollectable.
5. On October 5, 2018, SPY received $73,785 in invoices from vendors and suppliers for services provided during the gala event.
6. On October 25, 2018, SPY wrote checks to pay outstanding balances on accounts payable and outstanding balances related to the gala event.
7. For FY 2019, SPY reported the following expenses for the year: salaries and benefits of $530,781, employee medical and dental insurance coverage of $132,695, and fundraising and marketing costs of $123,648. All expenses were paid in full on or before June 30, 2019.
8. Depreciation expenses on existing property, plant, and equipment for FY 2019 were expected to be $81,492.
9. As of June 30, 2019, SPY had collected $785,482 in pledges receivable.
10. For FY 2019, SPY reported $44,825 in interest expense on its long-term debt. The non-profit made $40,841 in principal payments for the year.
11. At the end of FY 2019, SPY had received an additional $325,450 in unrestricted donor support. These were mostly in the form of monthly cash donations ($20 or $50 monthly pledges) from long-time supporters of SPY.
12. As of June 30, 2019, balances in the SPY investment account were $1,350,934.

Download Safe Place Worksheet: https://bit.ly/46cS6sJ