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Question: Help & Save is a private not-for-


Help & Save is a private not-for-profit entity that operates in Kansas. Swim For Safety is a private not-for-profit entity that operates in Missouri. The leaders of these two organizations have decided to combine forces on January 1, 2020, in order to have a bigger impact from their work. They are currently discussing ways by which this combination can be created. The following are statements of financial position for both charities at that date.



Help & Save is a private not-for-profit entity -1




Help & Save is a private not-for-profit entity -2

The buildings and equipment reported by Help & Save have a fair value of $900,000. The buildings and equipment reported by Swim For Safety have a fair value of $730,000.
a. Assume Help & Save pays $1 million in cash from its net assets without donor restrictions to gain complete control over Swim For Safety. If it is not assumed that Swim For Safety will be predominantly supported by contributions and investment income in the future, what balances will appear on the statement of financial position immediately after control is gained?
b. Assume Help & Save pays $990,000 in cash from its net assets without donor restrictions to gain complete control over Swim For Safety. It is assumed that Swim For Safety will be pre- dominantly supported by contributions and investment income in the future. What balances will appear on the statement of financial position immediately after control is gained?
c. Assume that these two organizations are combined into a new private not-for-profit entity to be known as Help–Swim–Save. A new governing body will be formed to manage and operate this new organization. What balances will appear on the statement of financial position immediately after control is gained?

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