Question 1

A good measure of whether a not-for-profit organization is operating its programs efficiently is:

Accepted Answer

A)  Fund-raising expenses as a percentage of public support. 
B)  The ratio of program expenses to number of clients served. 
C)  Total revenues divided by total expenses. 
D)  Percentage of program expenses to total expenses. 
A)  Fund-raising expenses as a percentage of public support. 
B)  The ratio of program expenses to number of clients served. 
C)  Total revenues divided by total expenses. 
D)  Percentage of program expenses to total expenses.

Question 2

The Internal Revenue Service may impose intermediate sanctions on all of the following transactions between a not-for-profit organization and its executive officer except:

Accepted Answer

A)  Excessive compensation. 
B)  More than the fair rental value for property owned by the officer. 
C)  A bargain on the sale of assets. 
D)  Fringe benefits comparable to those given to all employees. 
A)  Excessive compensation. 
B)  More than the fair rental value for property owned by the officer. 
C)  A bargain on the sale of assets. 
D)  Fringe benefits comparable to those given to all employees.

Question 3

Which of the following is not a statement about tax-exempt organizations?

Accepted Answer

A)  They must be organized to serve the charitable needs of the public at large. 
B)  They must first become a not-for-profit corporation or charitable trust. 
C)  They are permitted to do some political lobbying if guidelines are met. 
D)  Their unrelated business income is taxed at corporate income tax rates. 
A)  They must be organized to serve the charitable needs of the public at large. 
B)  They must first become a not-for-profit corporation or charitable trust. 
C)  They are permitted to do some political lobbying if guidelines are met. 
D)  Their unrelated business income is taxed at corporate income tax rates.

Question 4

The unrelated business income tax could be a significant cost and therefore should be of concern to tax-exempt organizations.

Accepted Answer

A) True 
 B)False

Question 5

A disqualified person is a person who has violated and been sanctioned under the Internal Revenue Code.

Accepted Answer

A) True 
 B)False

Question 6

The local Kennel Club is a not-for-profit organization with gross receipts of $23,500 for the current tax year.Under the Internal Revenue Service Code,the Kennel Club would be required to file which of the following forms for the tax year?

Accepted Answer

A)  Form 990-N. 
B)  Form 990-EZ. 
C)  Form 990-PF. 
D)  Since its gross receipts are less than $25,000 it need not file with the Internal Revenue Service. 
A)  Form 990-N. 
B)  Form 990-EZ. 
C)  Form 990-PF. 
D)  Since its gross receipts are less than $25,000 it need not file with the Internal Revenue Service.

Question 7

A large not-for-profit organization expended $1,250,000 in direct lobbying during the current year.As long as the $1,250,000 did not exceed 2 percent of the organization's exempt purpose expenditures,the amount is allowable according to the Internal Revenue Code.

Accepted Answer

A) True 
 B)False

Question 8

All not-for-profit organizations are required to file some type of Form 990 with the Internal Revenue Service.

Accepted Answer

A) True 
 B)False

Question 9

A program effectiveness ratio is helpful in assessing whether a not-for-profit is using its resources to accomplish its mission or goals.

Accepted Answer

A) True 
 B)False

Question 10

Why do states and the federal government exercise oversight responsibility over not-for-profit,tax-exempt corporations? How do states and the federal government differ in the way they exercise this responsibility?

Accepted Answer

States have oversight responsibility ove

Question 11

A nongovernmental tax-exempt organization must complete a Form 990 and send it to the Internal Revenue Service:

Accepted Answer

A)  Only if they have unrelated business income. 
B)  If they are not a religious organization, and have gross receipts of $5,000 or more each year. 
C)  If they have gross receipts of $1,000 or more each year. 
D)  Only if they are a private foundation, not a public charity. 
A)  Only if they have unrelated business income. 
B)  If they are not a religious organization, and have gross receipts of $5,000 or more each year. 
C)  If they have gross receipts of $1,000 or more each year. 
D)  Only if they are a private foundation, not a public charity.

Question 12

"Excess benefit transactions" are those in which persons who have substantial influence over the not-for-profit organization engage in transactions that result in economic benefits to them that are excessive,such as unreasonable compensation,sale of assets at bargain prices,and lease arrangements.

Accepted Answer

A) True 
 B)False

Question 13

If a tax-exempt organization dissolves and goes out of business,it must distribute its assets to another tax-exempt organization or a governmental entity.

Accepted Answer

A) True 
 B)False

Question 14

A tax-exempt organization that receives its support primarily from a large number of individuals or corporations and a relatively small amount from investment income is called a:

Accepted Answer

A)  Public charity. 
B)  Private foundation. 
C)  Public foundation. 
D)  Voluntary health and welfare organization. 
A)  Public charity. 
B)  Private foundation. 
C)  Public foundation. 
D)  Voluntary health and welfare organization.

A good measure of whether a not-for-profit organization is operating its programs efficiently is:

The Internal Revenue Service may impose intermediate sanctions on all of the following transactions between a not-for-profit organization and its executive officer except:

Which of the following is not a statement about tax-exempt organizations?

The unrelated business income tax could be a significant cost and therefore should be of concern to tax-exempt organizations.

A disqualified person is a person who has violated and been sanctioned under the Internal Revenue Code.

The local Kennel Club is a not-for-profit organization with gross receipts of $23,500 for the current tax year.Under the Internal Revenue Service Code,the Kennel Club would be required to file which of the following forms for the tax year?

A large not-for-profit organization expended $1,250,000 in direct lobbying during the current year.As long as the $1,250,000 did not exceed 2 percent of the organization's exempt purpose expenditures,the amount is allowable according to the Internal Revenue Code.

All not-for-profit organizations are required to file some type of Form 990 with the Internal Revenue Service.

A program effectiveness ratio is helpful in assessing whether a not-for-profit is using its resources to accomplish its mission or goals.

Why do states and the federal government exercise oversight responsibility over not-for-profit,tax-exempt corporations? How do states and the federal government differ in the way they exercise this responsibility?

A nongovernmental tax-exempt organization must complete a Form 990 and send it to the Internal Revenue Service:

"Excess benefit transactions" are those in which persons who have substantial influence over the not-for-profit organization engage in transactions that result in economic benefits to them that are excessive,such as unreasonable compensation,sale of assets at bargain prices,and lease arrangements.

If a tax-exempt organization dissolves and goes out of business,it must distribute its assets to another tax-exempt organization or a governmental entity.

A tax-exempt organization that receives its support primarily from a large number of individuals or corporations and a relatively small amount from investment income is called a:

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

Principles of Accounting and Financial Reporting for State and Local Governments

Governmental Operating Statement Accounts Budgetary Accounting

Accounting for Governmental Operating Activitiesillustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for the Business-Type Activities of State and Local Governments

Accounting for Fiduciary Activitiesagency and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Governmental Financial Performance

Auditing of Governmental and Not-For-Profit Organizations

Budgeting and Performance Measurement

Accounting for Not-For-Profit Organizations

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government Glossary

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Exam 14: Not-For-Profit Organizationsregulatory, Taxation, and Performance Issues

A good measure of whether a not-for-profit organization is operating its programs efficiently is:

The Internal Revenue Service may impose intermediate sanctions on all of the following transactions between a not-for-profit organization and its executive officer except:

Which of the following is not a statement about tax-exempt organizations?

The unrelated business income tax could be a significant cost and therefore should be of concern to tax-exempt organizations.

A disqualified person is a person who has violated and been sanctioned under the Internal Revenue Code.

The local Kennel Club is a not-for-profit organization with gross receipts of $23,500 for the current tax year.Under the Internal Revenue Service Code,the Kennel Club would be required to file which of the following forms for the tax year?

A large not-for-profit organization expended $1,250,000 in direct lobbying during the current year.As long as the $1,250,000 did not exceed 2 percent of the organization's exempt purpose expenditures,the amount is allowable according to the Internal Revenue Code.

All not-for-profit organizations are required to file some type of Form 990 with the Internal Revenue Service.

A program effectiveness ratio is helpful in assessing whether a not-for-profit is using its resources to accomplish its mission or goals.

Why do states and the federal government exercise oversight responsibility over not-for-profit,tax-exempt corporations? How do states and the federal government differ in the way they exercise this responsibility?

A nongovernmental tax-exempt organization must complete a Form 990 and send it to the Internal Revenue Service:

"Excess benefit transactions" are those in which persons who have substantial influence over the not-for-profit organization engage in transactions that result in economic benefits to them that are excessive,such as unreasonable compensation,sale of assets at bargain prices,and lease arrangements.

If a tax-exempt organization dissolves and goes out of business,it must distribute its assets to another tax-exempt organization or a governmental entity.

A tax-exempt organization that receives its support primarily from a large number of individuals or corporations and a relatively small amount from investment income is called a:

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

Principles of Accounting and Financial Reporting for State and Local Governments

Governmental Operating Statement Accounts Budgetary Accounting

Accounting for Governmental Operating Activitiesillustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for the Business-Type Activities of State and Local Governments

Accounting for Fiduciary Activitiesagency and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Governmental Financial Performance

Auditing of Governmental and Not-For-Profit Organizations

Budgeting and Performance Measurement

Accounting for Not-For-Profit Organizations

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government Glossary

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