Question 1

Donated materials are seldom recognized as a contribution and as an expense by a not-for-profit organization.

Accepted Answer

A) True 
 B)False  False

Question 2

The statement of financial position prepared by a nongovernmental NPO presents net assets in these categories: unrestricted; temporarily restricted; invested in capital assets,net of related debt; and permanently restricted.

Accepted Answer

A) True 
 B)False  False

Question 3

Statement of Financial Accounting Standards (SFAS)No.116 on contributions received and contributions made describes measurement and reporting rules for

Accepted Answer

A) Exchange transactions,such as membership dues and charges for services. 
B) Nonexchange transactions,such as unrestricted and restricted gifts. 
C) Gains and losses on investment income. 
D) Investment income (i.e.,dividends and interest). 
A) Exchange transactions,such as membership dues and charges for services. 
B) Nonexchange transactions,such as unrestricted and restricted gifts. 
C) Gains and losses on investment income. 
D) Investment income (i.e.,dividends and interest). B

Question 4

All of the following are characteristics of not-for-profit organizations (NPOs)that distinguish them from business organizations except

Accepted Answer

A) Contributions by resource providers who do not expect a return on investment. 
B) Ability to impose taxes on citizens. 
C) Operating purposes other than to earn a profit. 
D) Absence of ownership interests. 
A) Contributions by resource providers who do not expect a return on investment. 
B) Ability to impose taxes on citizens. 
C) Operating purposes other than to earn a profit. 
D) Absence of ownership interests.

Question 5

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

Accepted Answer

Support means revenue from contributions

Question 6

NPOs are required to prepare a statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 7

Donor-imposed restrictions must be clearly reflected in financial statements of not-for-profit organizations.

Accepted Answer

A) True 
 B)False

Question 8

Donated services should be recorded as contributions by a nongovernmental,not-for-profit organization if material,and if they meet the criteria set out in SFAS No.116.

Accepted Answer

A) True 
 B)False

Question 9

Cash received by a nongovernmental NPO in year 1 that the donor stipulates is to cover operating expenses of the following year should be recognized as an "increase in temporarily restricted net assets" in year 1 and as "net assets released from restrictions" in year 2.

Accepted Answer

A) True 
 B)False

Question 10

Unrealized gains on the investment portfolio of a not-for-profit organization are

Accepted Answer

A) Not recognized. 
B) Reported in the net asset section of the balance sheet. 
C) Depends on whether the gains relate to trading,available-for-sale,or held-to-maturity assets. 
D) Reported on the statement of activities. 
A) Not recognized. 
B) Reported in the net asset section of the balance sheet. 
C) Depends on whether the gains relate to trading,available-for-sale,or held-to-maturity assets. 
D) Reported on the statement of activities.

Question 11

Depreciation expense is reported in the statement of activities prepared by nongovernmental,not-for-profit organizations.

Accepted Answer

A) True 
 B)False

Question 12

An NPO incurred $10,000 in management and general expenses in the current fiscal year.In the organization's statement of activities prepared in conformity with FASB standards,the $10,000 would be reported as

Accepted Answer

A) A deduction from program revenue. 
B) A reduction of permanently restricted assets. 
C) Program services expenses. 
D) Supporting services expenses. 
A) A deduction from program revenue. 
B) A reduction of permanently restricted assets. 
C) Program services expenses. 
D) Supporting services expenses.

Question 13

Describe the difference between fund accounting and the accounting methods required by SFAS Nos.116 and 117.

Accepted Answer

Fund accounting,which is used by state a

Question 14

A voluntary health and welfare organization (VHWO)is a type of NPO that depends primarily on charges for services as a source of revenue,rather than on contributions from the public at large and provides health and welfare services to the public for a nominal or no fee.

Accepted Answer

A) True 
 B)False

Question 15

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.

Accepted Answer

No.The Governmental Accounting Standards

Question 16

An example of an increase in net assets for a not-for-profit organization that would be labeled revenue rather than support is

Accepted Answer

A) An unconditional promise to give. 
B) Investment income. 
C) A restricted gift. 
D) An allocation of funds from the local United Way organization. 
A) An unconditional promise to give. 
B) Investment income. 
C) A restricted gift. 
D) An allocation of funds from the local United Way organization.

Question 17

Statement of Financial Accounting Standards (SFAS)No.117 requires the following financial statements for all nongovernmental,not-for-profit organizations

Accepted Answer

A) Statement of financial position,statement of activities,statement of cash flows,and statement of functional expenses. 
B) Statement of financial position,statement of operations,statement of cash flows,and statement of functional expenses. 
C) Statement of financial position,statement of activities,and statement of cash flows. 
D) Statement of financial position,statement of revenues and expenses,statement of cash flows,and statement of functional expenses. 
A) Statement of financial position,statement of activities,statement of cash flows,and statement of functional expenses. 
B) Statement of financial position,statement of operations,statement of cash flows,and statement of functional expenses. 
C) Statement of financial position,statement of activities,and statement of cash flows. 
D) Statement of financial position,statement of revenues and expenses,statement of cash flows,and statement of functional expenses.

Question 18

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

Accepted Answer

A) Special events and related direct costs must be reported separately at their gross amounts if they relate to the ongoing major operations of an NPO. 
B) Special events must be reported net of related direct costs,even if they are of a peripheral or incidental nature. 
C) All special events may be reported net of related direct costs. 
D) Expenses of promoting and conducting special events should be netted directly against special events revenue. 
A) Special events and related direct costs must be reported separately at their gross amounts if they relate to the ongoing major operations of an NPO. 
B) Special events must be reported net of related direct costs,even if they are of a peripheral or incidental nature. 
C) All special events may be reported net of related direct costs. 
D) Expenses of promoting and conducting special events should be netted directly against special events revenue.

Question 19

Under current accounting and reporting standards nongovernmental,not-for-profit organizations (NPOs)must utilize the fund accounting structure set forth in the AICPA Audit and Accounting Guide Not-for-Profit Organizations.

Accepted Answer

A) True 
 B)False

Question 20

Investments in equity securities that have a readily determinable market value and all debt securities of a not-for-profit organization are reported at

Accepted Answer

A) Lower of cost or market. 
B) Amortized cost. 
C) Fair value. 
D) Cost. 
A) Lower of cost or market. 
B) Amortized cost. 
C) Fair value. 
D) Cost.

Donated materials are seldom recognized as a contribution and as an expense by a not-for-profit organization.

The statement of financial position prepared by a nongovernmental NPO presents net assets in these categories: unrestricted; temporarily restricted; invested in capital assets,net of related debt; and permanently restricted.

Statement of Financial Accounting Standards (SFAS)No.116 on contributions received and contributions made describes measurement and reporting rules for

All of the following are characteristics of not-for-profit organizations (NPOs)that distinguish them from business organizations except

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

NPOs are required to prepare a statement of cash flows.

Donor-imposed restrictions must be clearly reflected in financial statements of not-for-profit organizations.

Donated services should be recorded as contributions by a nongovernmental,not-for-profit organization if material,and if they meet the criteria set out in SFAS No.116.

Cash received by a nongovernmental NPO in year 1 that the donor stipulates is to cover operating expenses of the following year should be recognized as an "increase in temporarily restricted net assets" in year 1 and as "net assets released from restrictions" in year 2.

Unrealized gains on the investment portfolio of a not-for-profit organization are

Depreciation expense is reported in the statement of activities prepared by nongovernmental,not-for-profit organizations.

An NPO incurred $10,000 in management and general expenses in the current fiscal year.In the organization's statement of activities prepared in conformity with FASB standards,the $10,000 would be reported as

Describe the difference between fund accounting and the accounting methods required by SFAS Nos.116 and 117.

A voluntary health and welfare organization (VHWO)is a type of NPO that depends primarily on charges for services as a source of revenue,rather than on contributions from the public at large and provides health and welfare services to the public for a nominal or no fee.

An example of an increase in net assets for a not-for-profit organization that would be labeled revenue rather than support is

Statement of Financial Accounting Standards (SFAS)No.117 requires the following financial statements for all nongovernmental,not-for-profit organizations

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

Under current accounting and reporting standards nongovernmental,not-for-profit organizations (NPOs)must utilize the fund accounting structure set forth in the AICPA Audit and Accounting Guide Not-for-Profit Organizations.

Investments in equity securities that have a readily determinable market value and all debt securities of a not-for-profit organization are reported at

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 Activities Agency 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

Filters

Exam 14: Not-For-Profit Organizations Regulatory, taxation, and Performance Issues

Donated materials are seldom recognized as a contribution and as an expense by a not-for-profit organization.

The statement of financial position prepared by a nongovernmental NPO presents net assets in these categories: unrestricted; temporarily restricted; invested in capital assets,net of related debt; and permanently restricted.

Statement of Financial Accounting Standards (SFAS)No.116 on contributions received and contributions made describes measurement and reporting rules for

All of the following are characteristics of not-for-profit organizations (NPOs)that distinguish them from business organizations except

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

NPOs are required to prepare a statement of cash flows.

Donor-imposed restrictions must be clearly reflected in financial statements of not-for-profit organizations.

Donated services should be recorded as contributions by a nongovernmental,not-for-profit organization if material,and if they meet the criteria set out in SFAS No.116.

Cash received by a nongovernmental NPO in year 1 that the donor stipulates is to cover operating expenses of the following year should be recognized as an "increase in temporarily restricted net assets" in year 1 and as "net assets released from restrictions" in year 2.

Unrealized gains on the investment portfolio of a not-for-profit organization are

Depreciation expense is reported in the statement of activities prepared by nongovernmental,not-for-profit organizations.

An NPO incurred $10,000 in management and general expenses in the current fiscal year.In the organization's statement of activities prepared in conformity with FASB standards,the $10,000 would be reported as

Describe the difference between fund accounting and the accounting methods required by SFAS Nos.116 and 117.

A voluntary health and welfare organization (VHWO)is a type of NPO that depends primarily on charges for services as a source of revenue,rather than on contributions from the public at large and provides health and welfare services to the public for a nominal or no fee.

An example of an increase in net assets for a not-for-profit organization that would be labeled revenue rather than support is

Statement of Financial Accounting Standards (SFAS)No.117 requires the following financial statements for all nongovernmental,not-for-profit organizations

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

Under current accounting and reporting standards nongovernmental,not-for-profit organizations (NPOs)must utilize the fund accounting structure set forth in the AICPA Audit and Accounting Guide Not-for-Profit Organizations.

Investments in equity securities that have a readily determinable market value and all debt securities of a not-for-profit organization are reported at

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 Activities Agency 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

Filters