Question

A donor contributed $100,000 to the city stipulating that the money be invested and that the earnings thereon be used for maintenance of the city municipal swimming pool. The $100,000 would most appropriately be recorded in a(an)

a. Private-purpose trust fund
b. Permanent fund
c. Agency fund
d. Endowment fund

Answer 1

The $100,000 would most appropriately be recorded in a permanent fund.

Step-by-step explanation:

The $100,000 would most appropriately be recorded in a permanent fund.

A permanent fund is a type of fund that is established to generate earnings to support a specific purpose in perpetuity. In this case, the donor's contribution is intended to be invested, and the earnings generated from the investment will be used for the maintenance of the city municipal swimming pool.