Question 1

A Statement of Functional Expenses is required for

Accepted Answer

A)  State governments. 
B)  Tax agencies. 
C)  Voluntary health and welfare organizations. 
D)  Colleges and universities. 
A)  State governments. 
B)  Tax agencies. 
C)  Voluntary health and welfare organizations. 
D)  Colleges and universities.

Question 2

A donor gave $ 1,000,000 to a private not-for-profit organization to be held in endowment.In addition,the governing board permanently designated $ 500,000 to the endowment.In the Statement of Financial Position,how should these amounts be classified?

Accepted Answer

A)  Permanently Restricted: $1,500,000; Unrestricted: $ - 0 - 
B)  Permanently Restricted: $1,000,000; Unrestricted: $ 500,000 
C)  Permanently Restricted: $ 500,000; Unrestricted: $1,000,000 
D)  Permanently Restricted: $ - 0 ; Unrestricted: $1,500,000 
A)  Permanently Restricted: $1,500,000; Unrestricted: $ - 0 - 
B)  Permanently Restricted: $1,000,000; Unrestricted: $ 500,000 
C)  Permanently Restricted: $ 500,000; Unrestricted: $1,000,000 
D)  Permanently Restricted: $ - 0 ; Unrestricted: $1,500,000

Question 3

When should unconditional pledges be recorded as revenue?

Accepted Answer

A)  Never. 
B)  When money is received. 
C)  When the pledge is made. 
D)  When full collection is assured. 
A)  Never. 
B)  When money is received. 
C)  When the pledge is made. 
D)  When full collection is assured.

Question 4

Which of the following pledges of support would not be recognized in the year the pledge was made?

Accepted Answer

A)  An unconditional pledge restricted to a particular year in the future. 
B)  An unconditional pledge restricted to a particular purpose. 
C)  A pledge with no restrictions, but conditional on receiving matching pledges. 
D)  None of the above - all would be recognized. 
A)  An unconditional pledge restricted to a particular year in the future. 
B)  An unconditional pledge restricted to a particular purpose. 
C)  A pledge with no restrictions, but conditional on receiving matching pledges. 
D)  None of the above - all would be recognized.

Question 5

Donated services should be considered revenue if the service creates or enhances a nonfinancial asset and requires a specialized skill which would have had to be purchased if not donated.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is true regarding the Statement of Financial Position for nongovernmental,not-for-profit organizations?

Accepted Answer

A)  The Statement must display assets and liabilities separated between the categories of unrestricted, temporarily restricted, and permanently restricted. 
B)  The Statement must display totals for net assets separated between the categories of unrestricted, temporarily restricted, and permanently restricted. 
C)  Both A & B above. 
D)  Neither A nor B above. 
A)  The Statement must display assets and liabilities separated between the categories of unrestricted, temporarily restricted, and permanently restricted. 
B)  The Statement must display totals for net assets separated between the categories of unrestricted, temporarily restricted, and permanently restricted. 
C)  Both A & B above. 
D)  Neither A nor B above.

Question 7

Which of the following is not a characteristic that distinguishes a private not-for-profit organization from a business?

Accepted Answer

A)  Contributions are from resource providers who expect nothing in return. 
B)  Financial statements are intended primarily for use by donors. 
C)  The organization's revenues exceed expenses. 
D)  Absence of ownership interests. 
A)  Contributions are from resource providers who expect nothing in return. 
B)  Financial statements are intended primarily for use by donors. 
C)  The organization's revenues exceed expenses. 
D)  Absence of ownership interests.

Question 8

A membership pass to the YMCA (a private not-for-profit organization)includes unlimited rights to all facilities and a health magazine subscription.Non-members do not possess these rights.How must the YMCA account for membership dues?

Accepted Answer

A)  The dues are a non-exchange transaction, so it should report all dues in the year received. 
B)  The dues are a non-exchange transaction, so it should report dues on a pro-rata basis determined by the length of the individual memberships. 
C)  The dues are an exchange transaction, so it should report all dues in the year received. 
D)  The dues are an exchange transaction, so it should report dues on a pro-rata basis determined by the length of the individual memberships. 
A)  The dues are a non-exchange transaction, so it should report all dues in the year received. 
B)  The dues are a non-exchange transaction, so it should report dues on a pro-rata basis determined by the length of the individual memberships. 
C)  The dues are an exchange transaction, so it should report all dues in the year received. 
D)  The dues are an exchange transaction, so it should report dues on a pro-rata basis determined by the length of the individual memberships.

Question 9

Which of the following is not a condition for recording donated services?

Accepted Answer

A)  The individual providing the service provides an invoice detailing the hours contributed but waives the requirement for payment. 
B)  The service requires a specialized skill and the donor possesses those skills. 
C)  The service would have been paid for if not donated. 
D)  The service creates or enhances a non-financial asset. 
A)  The individual providing the service provides an invoice detailing the hours contributed but waives the requirement for payment. 
B)  The service requires a specialized skill and the donor possesses those skills. 
C)  The service would have been paid for if not donated. 
D)  The service creates or enhances a non-financial asset.

Question 10

Cash flows must be presented separately in the Statement of Cash Flows for the three classes (unrestricted,temporarily restricted,and permanently restricted).

Accepted Answer

A) True 
 B)False

Question 11

If a person names a private not-for-profit organization in his or her will,this is considered a(n)________ and is __________.

Accepted Answer

A)  Conditional promise to give; not recorded. 
B)  Unconditional promise to give; recorded. 
C)  Intention to give; recorded. 
D)  Intention to give; not recorded. 
A)  Conditional promise to give; not recorded. 
B)  Unconditional promise to give; recorded. 
C)  Intention to give; recorded. 
D)  Intention to give; not recorded.

Question 12

According to FASB Statement 124,Accounting for Certain Investments of Not-for-Profit Organizations,requires investments by a not-for-profit in debt securities but not equity securities to be carried at fair value.

Accepted Answer

A) True 
 B)False

Question 13

If a donor selects a scholarship recipient,and then donates cash to a ballet school to fund that scholarship,the ballet school would:

Accepted Answer

A)  Record a liability, as it is merely acting as an agent for the donation. 
B)  Record the donated cash as a contribution. 
C)  Record the scholarship awarded as a reduction of revenue. 
D)  Both B & C. 
A)  Record a liability, as it is merely acting as an agent for the donation. 
B)  Record the donated cash as a contribution. 
C)  Record the scholarship awarded as a reduction of revenue. 
D)  Both B & C.

Question 14

Which of the following is true of a Statement of Cash Flows for a private sector,private not-for-profit organization?

Accepted Answer

A)  Four categories are used: Operating, Capital Related Financing, Non-capital Related Financing, and Investing. 
B)  If the direct method is used, the not-for-profit must also present a reconciliation between total change in net assets and cash flows from operating activities. 
C)  Cash flows must be presented separately for Unrestricted, Temporarily Restricted, and Permanently Restricted categories. 
D)  None of the above; all are true. 
A)  Four categories are used: Operating, Capital Related Financing, Non-capital Related Financing, and Investing. 
B)  If the direct method is used, the not-for-profit must also present a reconciliation between total change in net assets and cash flows from operating activities. 
C)  Cash flows must be presented separately for Unrestricted, Temporarily Restricted, and Permanently Restricted categories. 
D)  None of the above; all are true.

Question 15

A donor gave $100,000 to a foundation,which is financially related to a nongovernmental,not-for-profit organization.The foundation,which is also a nongovernmental,not-for-profit organization,would record the $100,000 as:

Accepted Answer

A)  A Revenue. 
B)  A Liability. 
C)  Either (a) or (b), depending upon the policy of the foundation. 
D)  Neither (a) or (b); the transaction would not be recorded by the foundation. 
A)  A Revenue. 
B)  A Liability. 
C)  Either (a) or (b), depending upon the policy of the foundation. 
D)  Neither (a) or (b); the transaction would not be recorded by the foundation.

Question 16

The FASB requires that expenses of voluntary health and welfare organizations be reported according to function.Which of the following are FASB required function categories:

Accepted Answer

A)  Operating and Nonoperating 
B)  Program and Supporting Services. 
C)  Operating, Investing and Financing. 
D)  Capital and Noncapital Related 
A)  Operating and Nonoperating 
B)  Program and Supporting Services. 
C)  Operating, Investing and Financing. 
D)  Capital and Noncapital Related

Question 17

Answer the following questions regarding financial reporting by private not-for-profit organizations.
(1)What are the financial statements required for all private not-for-profit organizations?
(2)What organizations are required to present a Statement of Functional Expenses?
(3)What are the three classes of Net Assets?

Accepted Answer

(1)The financial reports are (a)Statemen

Question 18

With the exception of collections,fixed assets may be recorded by a private not-for-profit as:

Accepted Answer

A)  Temporarily restricted 
B)  Unrestricted 
C)  Both A & B above. 
D)  Neither A nor B above. 
A)  Temporarily restricted 
B)  Unrestricted 
C)  Both A & B above. 
D)  Neither A nor B above.

Question 19

Which of the following is true regarding accounting and financial reporting for nongovernmental,not-for-profit organizations?

Accepted Answer

A)  Expenses are classified as unrestricted or temporarily restricted. 
B)  Expenses must be reported by function, either in the statements or in the notes. 
C)  Both A & B above. 
D)  Neither A nor B above. 
A)  Expenses are classified as unrestricted or temporarily restricted. 
B)  Expenses must be reported by function, either in the statements or in the notes. 
C)  Both A & B above. 
D)  Neither A nor B above.

Question 20

Which of the following is not correct with respect to mergers under the rules established by FASB Statement No.164,Not-for-Profit Entities: Mergers and Acquisitions?

Accepted Answer

A)  If the combination qualifies as a merger, it will be accounted for using the carryover method. 
B)  Goodwill is recognized on long term assets only 
C)  Assets and liabilities are transferred from both existing entities to the new entity at book value. 
D)  The entity resulting from the merger is a new reporting entity, with no activity before the date of the merger. 
A)  If the combination qualifies as a merger, it will be accounted for using the carryover method. 
B)  Goodwill is recognized on long term assets only 
C)  Assets and liabilities are transferred from both existing entities to the new entity at book value. 
D)  The entity resulting from the merger is a new reporting entity, with no activity before the date of the merger.

A Statement of Functional Expenses is required for

A donor gave $ 1,000,000 to a private not-for-profit organization to be held in endowment.In addition,the governing board permanently designated $ 500,000 to the endowment.In the Statement of Financial Position,how should these amounts be classified?

When should unconditional pledges be recorded as revenue?

Which of the following pledges of support would not be recognized in the year the pledge was made?

Donated services should be considered revenue if the service creates or enhances a nonfinancial asset and requires a specialized skill which would have had to be purchased if not donated.

Which of the following is true regarding the Statement of Financial Position for nongovernmental,not-for-profit organizations?

Which of the following is not a characteristic that distinguishes a private not-for-profit organization from a business?

A membership pass to the YMCA (a private not-for-profit organization)includes unlimited rights to all facilities and a health magazine subscription.Non-members do not possess these rights.How must the YMCA account for membership dues?

Which of the following is not a condition for recording donated services?

Cash flows must be presented separately in the Statement of Cash Flows for the three classes (unrestricted,temporarily restricted,and permanently restricted).

If a person names a private not-for-profit organization in his or her will,this is considered a(n) and is __.

According to FASB Statement 124,Accounting for Certain Investments of Not-for-Profit Organizations,requires investments by a not-for-profit in debt securities but not equity securities to be carried at fair value.

If a donor selects a scholarship recipient,and then donates cash to a ballet school to fund that scholarship,the ballet school would:

Which of the following is true of a Statement of Cash Flows for a private sector,private not-for-profit organization?

A donor gave $100,000 to a foundation,which is financially related to a nongovernmental,not-for-profit organization.The foundation,which is also a nongovernmental,not-for-profit organization,would record the $100,000 as:

The FASB requires that expenses of voluntary health and welfare organizations be reported according to function.Which of the following are FASB required function categories:

With the exception of collections,fixed assets may be recorded by a private not-for-profit as:

Which of the following is true regarding accounting and financial reporting for nongovernmental,not-for-profit organizations?

Which of the following is not correct with respect to mergers under the rules established by FASB Statement No.164,Not-for-Profit Entities: Mergers and Acquisitions?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Proprietary Funds

Fiduciary Trustfunds

Government-Wide Statements, Capital Assets, Long-Term Debt

Accounting for Special-Purpose Entities, Including Public Colleges and Universities

College and University Accounting Private Institutions

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters

Exam 10: Accounting for Private Not-For-Profit Organizations

A Statement of Functional Expenses is required for

A donor gave $ 1,000,000 to a private not-for-profit organization to be held in endowment.In addition,the governing board permanently designated $ 500,000 to the endowment.In the Statement of Financial Position,how should these amounts be classified?

When should unconditional pledges be recorded as revenue?

Which of the following pledges of support would not be recognized in the year the pledge was made?

Donated services should be considered revenue if the service creates or enhances a nonfinancial asset and requires a specialized skill which would have had to be purchased if not donated.

Which of the following is true regarding the Statement of Financial Position for nongovernmental,not-for-profit organizations?

Which of the following is not a characteristic that distinguishes a private not-for-profit organization from a business?

A membership pass to the YMCA (a private not-for-profit organization)includes unlimited rights to all facilities and a health magazine subscription.Non-members do not possess these rights.How must the YMCA account for membership dues?

Which of the following is not a condition for recording donated services?

Cash flows must be presented separately in the Statement of Cash Flows for the three classes (unrestricted,temporarily restricted,and permanently restricted).

If a person names a private not-for-profit organization in his or her will,this is considered a(n)________ and is __________.

According to FASB Statement 124,Accounting for Certain Investments of Not-for-Profit Organizations,requires investments by a not-for-profit in debt securities but not equity securities to be carried at fair value.

If a donor selects a scholarship recipient,and then donates cash to a ballet school to fund that scholarship,the ballet school would:

Which of the following is true of a Statement of Cash Flows for a private sector,private not-for-profit organization?

A donor gave $100,000 to a foundation,which is financially related to a nongovernmental,not-for-profit organization.The foundation,which is also a nongovernmental,not-for-profit organization,would record the $100,000 as:

The FASB requires that expenses of voluntary health and welfare organizations be reported according to function.Which of the following are FASB required function categories:

With the exception of collections,fixed assets may be recorded by a private not-for-profit as:

Which of the following is true regarding accounting and financial reporting for nongovernmental,not-for-profit organizations?

Which of the following is not correct with respect to mergers under the rules established by FASB Statement No.164,Not-for-Profit Entities: Mergers and Acquisitions?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Proprietary Funds

Fiduciary Trustfunds

Government-Wide Statements, Capital Assets, Long-Term Debt

Accounting for Special-Purpose Entities, Including Public Colleges and Universities

College and University Accounting Private Institutions

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters

If a person names a private not-for-profit organization in his or her will,this is considered a(n) and is __.