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Homework - Chapter 2 Deadline: Friday - August 13, 2021 By 11:00 PM The newly established Environmental Council (a not-for-profit organization) uses two funds for internal reporting purposes. The general fund is used to record day-to-day operating transactions. A building fund is used to accumulate resources for a new building to house the Council's operations. Both funds are reported using the accrual basis of accounting. In its first year, the Council engaged in the following transactions: 1. It received cash contributions of $500,000, $100,000 of which donors stipulate must be used for the new building. 2. It incurred operating payroll costs of $200,000, of which $180,000 is paid in cash. 3. It earned $1,000 in interest (paid in cash) on investments restricted to the acquisition of the new building. 4. It transferred $25,000 from its general fund to the building fund. 5. It paid $15,000 in fees (accounted for as expenses) for architectural drawings for the proposed building. a. Prepare journal entries to record the transactions. Be sure to indicate the fund in which the entry would be made. b. Prepare a statement of revenues, expenses and other changes in fund balances and a balance sheet. Use a two- column format, one column for each of the Council's two funds

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