A Donor Gave $60,000 to a Nongovernmental, Not-For-Profit Charity with Instructions

Multiple Choice

A donor gave $60,000 to a nongovernmental, not-for-profit charity with instructions that the funds be transferred to Sam Smith, an individual who lost his home in a fire. The not-for-profit would:

A) Record the $60,000 cash and credit a liability.
B) Record the $60,000 cash and credit temporarily restricted revenue.
C) Do either a or b, depending upon the policy of the not-for-profit.
D) Not record the transaction, because the money is going directly to the intended recipient.