Exam 15: Accounting for Colleges and Universities

Tuition scholarships for which there is no intention of performance from the student should be classified by a private university as

The Uniform Prudent Management of Institutional Funds Act (UPMIFA) applies primarily to colleges and universities.

Receipt of a $500,000 gift by a private college that must be invested, the earning of which are to be used to support a "chaired" professorship in accounting, would be recorded as an increase in net assets with donor restrictions.

A private university following the recommendations of the National Association of College and University Business Officers (NACUBO) chart of accounts for reporting expenses must disclose expenses by program and support function in the notes.

Only public colleges and universities are subject to the federal single audit requirements.

Earnings on a private college's endowment investments may increase net assets without donor restrictions or net assets with donor restrictions, or both.

Public colleges and universities that use business-type reporting must present segment information in the notes to the financial statements.

Tuition refunds are recorded by debiting Tuition and Fees-Unrestricted.

During the years ended June 30, 2020 and 2021, Jackson University, a private university, conducted a cancer research project financed by a $1,000,000 gift from an alumnus. The entire amount was pledged by the donor on July 10, 2019. The gift was restricted to the financing of this particular research project. During the two-year research period, Jackson's gift receipts from the alumnus and research expenses related to the research project were as follows for each fiscal year (FY): What amount of net assets was released from restriction in 2020?

Which of the following statements about the Uniform Prudent Management of Institutional Funds Act (UPMIFA) is correct?

Private colleges and universities report term endowments as net assets with donor restrictions until the term has expired.

Which of the following is required as part of a complete set of financial statements for a public college or university engaged only in business-type activities?

Which of the following items would not affect the amounts reported in the Revenues and Gains section of the statement of activities for a private college or university?

The organizational form of a college can be governmental, nongovernmental not-for-profit, or for-profit.

If a private university receives $1,000,000 in the current fiscal year as a grant restricted for a specific research project and makes expenditures amounting to $400,000 during the current fiscal year properly chargeable to the grant, how much should be reported as revenues in the current fiscal year? Explain.

An annuity agreement requires that a college pay the donor (or other designated individual) a fixed dollar amount at specified time intervals.

Which of the following statements is required for both a private university and a governmentally owned public university engaged only in business-type activities?

Private colleges report intangible assets as a separate asset classification; whereas, public colleges report intangible assets as part of the capital asset classification.

A private university receives $1,000,000 in the current fiscal year as a grant restricted for a specific research project and incurs expenses of $400,000 related to the research project during the current fiscal year. Make all necessary journal entries to record the transactions related to the grant for the current fiscal year. Prepare journal entries to record the transactions related to the grant for the current fiscal year. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

An example of a college outcome performance metric would be performance on nationally ranked exams such as the CPA exam.