Exam 13: Accounting for Not-For-Profit Organizations

When a nongovernmental not-for-profit organization spends money for the purpose for which an external donor intended,then the expense is reported as a

Which of the following characteristics of not-for-profit organizations (NFPs)can be used to distinguish a nongovernmental from a governmental NFP?

Which of the following terms is used to indicate that a donor provided a gift with explicit instructions that the gift is to be used for a specific purpose by the not-for-profit but the entire amount may be spent right away?

A donor provides a large cash contribution that is to be used for acquisition of a new building.Under FASB standards,how would this contribution be reported by a not-for-profit organization on its statement of cash flows?

Explain when donated materials should be recognized as a contribution and as an expense by a nongovernmental not-for-profit organization.

A local philanthropist made an unconditional pledge to donate $100,000 to a not-for-profit organization to be paid in five equal installments of $20,000 beginning in two years.Under FASB standards the pledge would be recognized as

Supporting services expenses include fund-raising and management and general expenses that are not directly attributable to specific programs.

Distinguish between "support" and "revenues from exchange transactions".

Which of the following statements is correct regarding reporting of special events and related direct costs under current FASB standards?

Investments should be initially recorded by a not-for-profit organization at cost,or in the case of donated investments at fair value as of the date of the donation.

Would a not-for-profit library that receives the majority of its resources from a specific tax levy on local citizens remitted to the city follow the same financial reporting principles as would a library that operates without a dedicated tax and instead relies on contributions from individuals and grants from foundations and governments? Explain.

Securities donated to a not-for-profit organization should be recorded at the

Which of the following statements is true regarding fund accounting for not-for-profit organizations (NFPs)?

Contributions received in a prior period and restricted by the donor for construction of a building were reported as increases to "temporarily restricted net assets" in the period received.When the building is constructed in a subsequent period an NFP would report "contributions" for the amount released from restrictions.

A voluntary health and welfare organization (VHWO)is a type of NFP that depends primarily on charges for services as a source of revenue,rather than on contributions from the public at large.

In the current year,the not-for-profit organization Save the Butterflies Foundation received cash of $500 to be used as the Foundation wished and $1,000 to be used for butterfly research.Save the Butterflies also received pledges of $700 that it can use as it wishes and $600 for its building fund.All pledges are expected to be received next year.How much would Save the Butterflies report as temporarily restricted contributions in the current year?

Under FASB standards,expenses of a not-for-profit organization can only be shown as reductions of unrestricted net assets.