Fundamentals of Advanced Accounting 5th Edition by Joe Ben Hoyle,Thomas Schaefer,Timothy Doupnik

Exercise 7

The City of Wilson receives a large sculpture valued at $240,000 as a gift to be placed in front of the municipal building. Which of the following is true for reporting the gift on the government-wide financial statements
a. A capital asset of $240,000 must be reported.
b. No capital asset will be reported.
c. If conditions are met, recording the sculpture as a capital asset is optional.
d. The sculpture will be recorded but only for the amount paid by the city.