Question 1

How does a for-profit organization record contributions made to a private not-for-profit organization?

Accepted Answer

A)  As an expense when originally pledged 
B)  As a reduction in revenue when pledged 
C)  As an expense when contributed 
D)  As a reduction in revenue when contributed 
A)  As an expense when originally pledged 
B)  As a reduction in revenue when pledged 
C)  As an expense when contributed 
D)  As a reduction in revenue when contributed

Question 2

Care Foundation is a voluntary health and welfare organization funded by contributions from the general public. In its Statement of Activities, depreciation expense should:

Accepted Answer

A)  Not be included 
B)  Be included as an element of support 
C)  Be included as an element of changes in fund balances 
D)  Be included as an element of expense 
A)  Not be included 
B)  Be included as an element of support 
C)  Be included as an element of changes in fund balances 
D)  Be included as an element of expense

Question 3

Conditional pledges should not be recognized as revenue until the conditions have been met.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is not true regarding the treatment of multiyear pledges, according to FASB Statement 116?

Accepted Answer

A)  They are recorded at the present value of future collections 
B)  They should be reported net of an allowance for estimated uncollectibles 
C)  They should be recorded as temporarily restricted 
D)  At the end of each accounting period, the difference between the new and previously recorded present value is recorded as interest revenue 
A)  They are recorded at the present value of future collections 
B)  They should be reported net of an allowance for estimated uncollectibles 
C)  They should be recorded as temporarily restricted 
D)  At the end of each accounting period, the difference between the new and previously recorded present value is recorded as interest revenue

Question 5

The Statement of Cash Flows for a not-for-profit organization, has four different classifications of cash flows.

Accepted Answer

A) True 
 B)False

Question 6

The GASB has standards-setting authority over state and local governments, including governmentally related not-for-profit organizations such as hospitals colleges and universities. Private not-for-profits must follow all applicable ____ standards in recording transactions.

Accepted Answer

A)  AICPA 
B)  FASB 
C)  GASB 
D)  SEC 
A)  AICPA 
B)  FASB 
C)  GASB 
D)  SEC

Question 7

FASB Statement 136 Transfer of Assets to a Not-for-Profit Organization or Charitable Trust that Raises or Holds Contributions for Others provides guidance on how intermediary recipient organizations should record receipt of resources held for others. Briefly describe the issue and how such transfers should be recorded.

Accepted Answer

It is not uncommon for a not-for-profit

Question 8

The primary users of the financial statements of private not-for-profit organizations are:

Accepted Answer

A)  Owners of the organization 
B)  Present and potential donors 
C)  Investors 
D)  Government agencies 
A)  Owners of the organization 
B)  Present and potential donors 
C)  Investors 
D)  Government agencies

Question 9

Reclassifications from permanently restricted net assets to temporarily restricted net assets would occur only under which of the following circumstances?

Accepted Answer

A)  Time Restrictions Placed on the Permanently Restricted Net Assets Have Been Met 
B)  Purpose Restriction Placed on the Permanently Restricted Net Assets Have Been Met 
C)  Either of the Above Criteria Have Been Met 
D)  Permanently Restricted Net Assets Would Not Be Reclassified to Temporarily Restricted Net Assets 
A)  Time Restrictions Placed on the Permanently Restricted Net Assets Have Been Met 
B)  Purpose Restriction Placed on the Permanently Restricted Net Assets Have Been Met 
C)  Either of the Above Criteria Have Been Met 
D)  Permanently Restricted Net Assets Would Not Be Reclassified to Temporarily Restricted Net Assets

Question 10

Which of the following is a legitimate reason for a not-for-profit organization to have a surplus (increase in net assets)?

Accepted Answer

A)  To establish working capital 
B)  To retire debt 
C)  Both (a) and (b) above 
D)  None of the above, not-for-profits should not have surpluses 
A)  To establish working capital 
B)  To retire debt 
C)  Both (a) and (b) above 
D)  None of the above, not-for-profits should not have surpluses

Question 11

When preparing the Statement of Cash Flows for a not-for-profit organization, the direct or indirect method of may be used.

Accepted Answer

A) True 
 B)False

Question 12

The equity section of Statement of Financial Position for private not-for-profits includes which accounts?

Accepted Answer

A)  Unrestricted, Temporarily Restricted, Permanently Restricted 
B)  Invested in Capital Assets net of related debt, unrestricted net assets 
C)  Unreserved Fund Balance, Reserved Fund Balance 
D)  None of the above describes the proper accounting treatment 
A)  Unrestricted, Temporarily Restricted, Permanently Restricted 
B)  Invested in Capital Assets net of related debt, unrestricted net assets 
C)  Unreserved Fund Balance, Reserved Fund Balance 
D)  None of the above describes the proper accounting treatment

Question 13

Answer the following questions regarding financial reporting by private not-for-profit organizations.
(1) What are the required financial statements?
(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) Statem

Question 14

Present and potential donors are the primary users of private not-for-profit financial statements.

Accepted Answer

A) True 
 B)False

Question 15

State governments are required to prepare a Statement of Functional Expenses.

Accepted Answer

A) True 
 B)False

Question 16

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 17

FASB statement 116 requires contributions to be recorded as revenue when

Accepted Answer

A)  The contributed money is actually received 
B)  The contribution is likely to be received 
C)  The contribution is promised 
D)  The contribution is probable and measurable 
A)  The contributed money is actually received 
B)  The contribution is likely to be received 
C)  The contribution is promised 
D)  The contribution is probable and measurable

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

Contributed services to private not-for-profit's are recognized as revenue/support if:

Accepted Answer

A)  It creates or enhances nonfinancial assets 
B)  It requires a specialized skill 
C)  It would have had to be purchased if it wasn't provided 
D)  All of the above 
A)  It creates or enhances nonfinancial assets 
B)  It requires a specialized skill 
C)  It would have had to be purchased if it wasn't provided 
D)  All of the above

Question 20

Which of the following financial statements are required for voluntary health and welfare organizations?

Accepted Answer

A)  Income Statement 
B)  Statement of Net Assets 
C)  Statement of Functional Expenses 
D)  Budgetary Comparison Schedule 
A)  Income Statement 
B)  Statement of Net Assets 
C)  Statement of Functional Expenses 
D)  Budgetary Comparison Schedule

How does a for-profit organization record contributions made to a private not-for-profit organization?

Care Foundation is a voluntary health and welfare organization funded by contributions from the general public. In its Statement of Activities, depreciation expense should:

Conditional pledges should not be recognized as revenue until the conditions have been met.

Which of the following is not true regarding the treatment of multiyear pledges, according to FASB Statement 116?

The Statement of Cash Flows for a not-for-profit organization, has four different classifications of cash flows.

The GASB has standards-setting authority over state and local governments, including governmentally related not-for-profit organizations such as hospitals colleges and universities. Private not-for-profits must follow all applicable ____ standards in recording transactions.

The primary users of the financial statements of private not-for-profit organizations are:

Reclassifications from permanently restricted net assets to temporarily restricted net assets would occur only under which of the following circumstances?

Which of the following is a legitimate reason for a not-for-profit organization to have a surplus (increase in net assets)?

When preparing the Statement of Cash Flows for a not-for-profit organization, the direct or indirect method of may be used.

The equity section of Statement of Financial Position for private not-for-profits includes which accounts?

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

Present and potential donors are the primary users of private not-for-profit financial statements.

State governments are required to prepare a Statement of Functional Expenses.

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:

FASB statement 116 requires contributions to be recorded as revenue when

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

Contributed services to private not-for-profit's are recognized as revenue/support if:

Which of the following financial statements are required for voluntary health and welfare organizations?

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 Trust Funds

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

Filters

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

How does a for-profit organization record contributions made to a private not-for-profit organization?

Care Foundation is a voluntary health and welfare organization funded by contributions from the general public. In its Statement of Activities, depreciation expense should:

Conditional pledges should not be recognized as revenue until the conditions have been met.

Which of the following is not true regarding the treatment of multiyear pledges, according to FASB Statement 116?

The Statement of Cash Flows for a not-for-profit organization, has four different classifications of cash flows.

The GASB has standards-setting authority over state and local governments, including governmentally related not-for-profit organizations such as hospitals colleges and universities. Private not-for-profits must follow all applicable ____ standards in recording transactions.

The primary users of the financial statements of private not-for-profit organizations are:

Reclassifications from permanently restricted net assets to temporarily restricted net assets would occur only under which of the following circumstances?

Which of the following is a legitimate reason for a not-for-profit organization to have a surplus (increase in net assets)?

When preparing the Statement of Cash Flows for a not-for-profit organization, the direct or indirect method of may be used.

The equity section of Statement of Financial Position for private not-for-profits includes which accounts?

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

Present and potential donors are the primary users of private not-for-profit financial statements.

State governments are required to prepare a Statement of Functional Expenses.

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:

FASB statement 116 requires contributions to be recorded as revenue when

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

Contributed services to private not-for-profit's are recognized as revenue/support if:

Which of the following financial statements are required for voluntary health and welfare organizations?

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 Trust Funds

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

Filters