Accounting for the Purchase of a Fixed Asset from Temporarily Restricted Funds
Our church has a General Fund as well as several permanently restricted and temporarily restricted funds.
One of our temporarily restricted funds is used to collect donations towards the purchase of a large fixed asset.
Once we have enough funds in that account and want to purchase the fixed asset, what are the accounting entries that should be made?
Typically I would expect income is recorded as donations come in, and expense as the asset is depreciated. This logics distorts the income statement, though, and I am wondering if there is a different way I can account for this.