alleryTreatment of legacy donation received specifically for a charitable activity:
ACredit to specific fund
BCredit to I&E directly
CDebit to capital fund
DTreat as deferred income
Answer & Solution
Correct answer: A. Credit to specific fund
1. Legacy is a donation received under a will, often with specific intent.
2. If restricted, it is credited to a specific fund (e.g. Charity Fund).
3. Use of the fund is then matched with the legacy purpose.
_Source: ICAI BoS Foundation Paper 1, Ch 8 "NPO", §3.1 legacies_
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