Question: (Journal entries for a Private Purpose Trust Fund) Record the following journal entries in the Children's Book Fund, a city's Private Purpose Trust Fund that supplies books for children in privately owned battered women's shelters.
1. A citizen donated $500,000 to a Private Purpose Trust Fund. The trust specified that this money was to be used to acquire children's books for battered women's shelters.
2. The fund invested $420,000 in CDs.
3. Books costing $45,000 were acquired.
4. Interest income of $20,000 was received in cash from the CDs.
5. The accounts were closed for the year.