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

Under FASB standards, donated services are:

A Statement of Functional Expenses is required for public colleges and universities.

Not for profit entities are usually primarily concerned with which of the following performance measures?

A Statement of Functional Expenses which is required for voluntary health and welfare organizations, presents a matrix of expenses classified by function and by object or natural classification.

FASB statement 116 requires contributions to be recorded as revenue when the contribution is likely to be received.

Which of the following contributed services would probably not be recognized as contribution revenue?

Which of the following organizations would be subject to the accounting and reporting requirements of FASB Statements 116 (Accounting for Contributions) and 117 (Financial Reporting for Not-for-Profit Organizations)?

According to FASB, which of the following is not something that distinguishes a not-for-profit organization from a business?

The FASB has the authority to set accounting standards for all of the following organizations except:

The entry to record the expiration of program restrictions includes which of the following?

Henry Highbrow promises to donate $50,000 to his church toward the purchase of a new pipe organ if the church is able to raise matching funds of $50,000 from other contributors. At what point should the church record revenue?

A Statement of Functional Expenses is required for state governments.

A donor gave equipment valued at $50,000 at the beginning of 2009 to a not-for-profit organization. The equipment had a 10-year life and depreciation of $5,000 was charged during 2009. At the end of the year, the net assets to be reported in unrestricted net assets related to this equipment would be:

A donor made a cash contribution of $50,000 to a not-for-profit organization for the purpose of acquiring a building. The not-for-profit organization properly recorded the gift of cash as temporarily restricted revenue. When the building is acquired, the organization should:

A donor made a gift of cash to a not-for-profit organization in 2009 with an expressed purpose restriction. All the funds were expended in 2009. The organization must:

The FASB requires not-for-profit organizations to report individual assets and liabilities separated by unrestricted, temporarily restricted and permanently restricted.

Which of the following organizations would be subject to the (level b) accounting and reporting requirements of the AICPA's Audit and Accounting Guide: Not-for-Profit Organizations?

Which of the following is NOT an example of a voluntary health and welfare organization?

With respect to the Statement of Cash Flows for a not-for-profit organization, the purchase of equipment would be considered an investing activity.

Assume that The Sandy Creek Nature Center, a not-for-profit organization, started the fiscal year ending December 31, 2009 with $50,876 in temporarily restricted net assets. The amounts are restricted for the following: • Restricted for educational programs relating to preservation of wetlands $15,240. • Restricted for future equipment purchases $20,000 (Fixed assets are recorded as unrestricted when acquired) and • A promise to provide $3,000 each of the next six years for general support. Assume the pledge was made on December 31, 2008 and the present value of six (January 1) payments discounted at 6 percent is $15,636. During the fiscal year ended December 31, 2009, the following transactions occur: (a) The first $3,000 installment on the pledge receivable was received. (b) Expenses related to educational programs on conservation of wetlands were incurred and paid in the amount of $10,485 (c) The $20,000 received in a prior year for equipment, together with an additional $25,500 was used to acquire equipment. (d) Interest of 6% is recorded on the remaining balance of the pledge receivable. Required: Prepare the journal entries necessary for the above transactions: