Question 1

What is the basis of accounting used in reporting the Statement of Activities and Changes in Net Assets?

Accepted Answer

A)  Cash basis. 
B)  Modified accrual basis. 
C)  Accrual basis. 
D)  Either cash basis or accrual basis, depending on the type of revenue. 
E)  Either modified accrual basis or accrual basis, depending on the type of revenue. 
A)  Cash basis. 
B)  Modified accrual basis. 
C)  Accrual basis. 
D)  Either cash basis or accrual basis, depending on the type of revenue. 
E)  Either modified accrual basis or accrual basis, depending on the type of revenue.

Question 2

For the month of December 2011, patient charges at Northfield Hospital (a not-for-profit hospital) were $2,720,000. Third-party payors were billed $1,800,000.
-In this month, there were several patients that had no health insurance and due to their low income level, the hospital decided that $85,000 of receivables would not be collectible.
Required:
Prepare the necessary journal entry to reflect the decision to consider the $85,000 as charity care.

Accepted Answer

The answer of For the month of December 2011, patient...

Question 3

Wakefield Home is a private not-for-profit healthcare organization offering services for a fee. In the first quarter of 2011, Wakefield Home rendered services of $300,000 to patients. Of this amount 75% will be paid by patients, and $25,000 will be adjusted based on estimated insurance agreements. The remaining amount is to be paid by third party insurance providers.
-A local business donated medical supplies to Wakefield with a value of $40,000.
Prepare the journal entry for the receipt of these supplies.

Accepted Answer

The answer of Wakefield Home is a private not-for-profit healthcare...

Question 4

Which entry would be the correct entry on the not-for-profit organization's books to record a donor's gift when the money is simply passing through the not-for-profit organization and creates no direct benefit, and when control of the assets has been relinquished by the donor? $$\begin{array} { l l } 
{ \text { DEBIT } } & \text { CREDIT } \
\text { A) Expense-charitable contribution } & \text { Cash } \
\text { B) Refundable advance to charity } & \text { Cash } \
\text { C) Cash } & \text { Liability to beneficiary } \
\text { D) Cash } & \text { Refundable advance } \
\text { E) Cash } & \text { Contribution revenue }
\end{array}$$

Accepted Answer

A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E 
A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E

Question 5

A not-for-profit organization (Charity A) raises money for other charitable organizations. Charity A receives $10,000 to distribute to Charity B.
-Assume that the donor retains the right to revoke or redirect the gift.
Prepare the journal entries for Charity A and Charity B when the gift is received, and for Charity A and Charity B when the gift is distributed.

Accepted Answer

The answer of A not-for-profit organization (Charity A) raises money...

Question 6

For the month of December 2011, patient charges at Northfield Hospital (a not-for-profit hospital) were $2,720,000. Third-party payors were billed $1,800,000.
-The hospital estimated that contractual adjustments would reduce the amount collected from third-party payors to $1,710,000.
Required:
Prepare the necessary journal entry to record the contractual adjustments.

Accepted Answer

The answer of For the month of December 2011, patient...

Question 7

In not-for-profit accounting, an acquisition occurs when one not-for-profit organization obtains:

Accepted Answer

A)  Significant influence over another not-for-profit organization. 
B)  The direct ability to determine the direction of management of another not-for-profit organization. 
C)  The indirect ability to direct the policies of management of another not-for-profit organization. 
D)  Control over another not-for-profit organization. 
E)  None of the above. An acquisition can only occur for profit-oriented organizations. 
A)  Significant influence over another not-for-profit organization. 
B)  The direct ability to determine the direction of management of another not-for-profit organization. 
C)  The indirect ability to direct the policies of management of another not-for-profit organization. 
D)  Control over another not-for-profit organization. 
E)  None of the above. An acquisition can only occur for profit-oriented organizations.

Question 8

Which entry would be the correct entry on the donor's books when the donor retains control of an asset that it contributes to a not-for-profit organization? $$\begin{array} { l l } 
 { \text { DEBIT } } & \text { CREDIT } \
\hline \text { A) Expense-charitable contribution } & \text { Cash } \
\text { B) Refundable advance to charity } & \text { Cash } \
\text { C) Charitable pledge } & \text { Cash } \
\text { D) Cash } & \text { Liability to beneficiary } \
\text { E) Cash } & \text { Refundable advance }
\end{array}$$

Accepted Answer

A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E 
A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E

Question 9

A local social worker, earning $12 per hour working for the state government, contributed 600 hours of time at no charge to the Yelton Center, a voluntary health and welfare organization. If not for these donated services, an additional staff person would have been hired by the organization.
Required:
How should the Yelton Center record the contributed services?

Accepted Answer

Donated services would be valued at $7,2

Question 10

Which of the following statements is required for voluntary health and welfare organizations, but not for other not-for-profit organizations?

Accepted Answer

A)  Statement of Activities and Changes in Net Assets. 
B)  Statement of Functional Expenses. 
C)  Statement of Financial Position. 
D)  Statement of Cash Flows. 
E)  Statement of Budget to Actual. 
A)  Statement of Activities and Changes in Net Assets. 
B)  Statement of Functional Expenses. 
C)  Statement of Financial Position. 
D)  Statement of Cash Flows. 
E)  Statement of Budget to Actual.

Question 11

What financial statements would normally be prepared by a voluntary health and welfare organization?

Accepted Answer

A voluntary health and welfare organizat

Question 12

What term is used by voluntary health and welfare organizations for contributions?

Accepted Answer

The term used by voluntary hea

Question 13

On a statement of functional expenses for a voluntary health and welfare organization, how are expenses classified?

Accepted Answer

A)  Health services expenses and operating expenses. 
B)  Program services expenses and administrative services expenses. 
C)  Program services expenses and supporting services expenses. 
D)  Operating expenses and supporting services expenses. 
E)  Operating expenses and administrative expenses. 
A)  Health services expenses and operating expenses. 
B)  Program services expenses and administrative services expenses. 
C)  Program services expenses and supporting services expenses. 
D)  Operating expenses and supporting services expenses. 
E)  Operating expenses and administrative expenses.

Question 14

Which entry would be the correct entry on the not-for-profit organization's books to record a donor's gift when power over the assets has been retained by the donor? $\begin{array} { l l }\text {DEBIT}&\text {CREDIT}\ \text { A) Expense-charitable contribution } & \text { Cash } \ \text { B) Refundable advance to charity } & \text { Cash } \ \text { C) Cash } & \text { Liability to beneficiary } \ \text { D) Cash } & \text { Refundable advance } \ \text { E) Cash } & \text { Contribution revenue } \end{array}$

Accepted Answer

A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E 
A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E

Question 15

A gift to a not-for-profit school that is not restricted by the donor is credited to:

Accepted Answer

A)  Fund Balance. 
B)  Deferred Revenues. 
C)  Contribution Revenues. 
D)  Nonoperating Revenues. 
E)  Encumbrances. 
A)  Fund Balance. 
B)  Deferred Revenues. 
C)  Contribution Revenues. 
D)  Nonoperating Revenues. 
E)  Encumbrances.

Question 16

A not-for-profit organization receives a computer as a donation (valued at $2,000). Prepare the journal entry for the transaction.

Accepted Answer

The answer of A not-for-profit organization receives a computer as...

Question 17

A not-for-profit organization (Charity A) raises money for other charitable organizations. Charity A receives $10,000 to distribute to Charity B.
-Assume there are no donor rights to revoke or redirect the gift.
Prepare the journal entries for Charity A when the gift is received, and for Charity A and Charity B when the gift is distributed.

Accepted Answer

The answer of A not-for-profit organization (Charity A) raises money...

Question 18

In accruing patient charges for the current month, which one of the following accounts should a hospital credit?

Accepted Answer

A)  Accounts Payable. 
B)  Deferred Revenue. 
C)  Unearned Revenue. 
D)  Patient Service Revenues. 
E)  Accounts Receivable. 
A)  Accounts Payable. 
B)  Deferred Revenue. 
C)  Unearned Revenue. 
D)  Patient Service Revenues. 
E)  Accounts Receivable.

Question 19

Which entry would be the correct entry to record that a hospital has provided patient services for $200,000, of which 25% will be billed to a third party?

Accepted Answer

A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E 
A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D 
E)  Option E

Question 20

Which of the following is not true about a merger of two not-for-profit organizations?

Accepted Answer

A)  The two organizations will continue to legally exist but there will be a new governing board. 
B)  Neither organization is considered to be acquired. 
C)  Identifiable assets and liabilities are not adjusted to their fair values at the date of the merger. 
D)  The two entities will together form an entirely new organization with a new governing board. 
E)  There will be no acquisition value or goodwill determination. 
A)  The two organizations will continue to legally exist but there will be a new governing board. 
B)  Neither organization is considered to be acquired. 
C)  Identifiable assets and liabilities are not adjusted to their fair values at the date of the merger. 
D)  The two entities will together form an entirely new organization with a new governing board. 
E)  There will be no acquisition value or goodwill determination.

What is the basis of accounting used in reporting the Statement of Activities and Changes in Net Assets?

In not-for-profit accounting, an acquisition occurs when one not-for-profit organization obtains:

Which of the following statements is required for voluntary health and welfare organizations, but not for other not-for-profit organizations?

What financial statements would normally be prepared by a voluntary health and welfare organization?

What term is used by voluntary health and welfare organizations for contributions?

On a statement of functional expenses for a voluntary health and welfare organization, how are expenses classified?

A gift to a not-for-profit school that is not restricted by the donor is credited to:

A not-for-profit organization receives a computer as a donation (valued at $2,000). Prepare the journal entry for the transaction.

In accruing patient charges for the current month, which one of the following accounts should a hospital credit?

Which entry would be the correct entry to record that a hospital has provided patient services for $200,000, of which 25% will be billed to a third party?

Which of the following is not true about a merger of two not-for-profit organizations?

The Equity Method of Accounting for Investments

Consolidation of Financial Information

Consolidations-Subsequent to the Date of Acquisition

Consolidated Financial Statements and Outside Ownership

Consolidated Financial Statements - Intra-Entity Asset Transactions

Variable Interest Entities, Intra-Entity Debt, Consolidated Cash Flo

Consolidated Financial Statements - Ownership Patterns and Income

Segment and Interim Reporting

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Worldwide Accounting Diversity and International Standards

Financial Reporting and the Securities and Exchange Commission

Accounting for Legal Reorganizations and Liquidations

Partnerships: Formation and Operations

Partnerships: Termination and Liquidation

Accounting for State and Local Governments

Accounting for State and Local Governments

Accounting for Estates and Trusts

Filters

Exam 18: Accounting and Reporting for Private Not-For-Profit Organizations

What is the basis of accounting used in reporting the Statement of Activities and Changes in Net Assets?

In not-for-profit accounting, an acquisition occurs when one not-for-profit organization obtains:

Which of the following statements is required for voluntary health and welfare organizations, but not for other not-for-profit organizations?

What financial statements would normally be prepared by a voluntary health and welfare organization?

What term is used by voluntary health and welfare organizations for contributions?

On a statement of functional expenses for a voluntary health and welfare organization, how are expenses classified?

A gift to a not-for-profit school that is not restricted by the donor is credited to:

A not-for-profit organization receives a computer as a donation (valued at $2,000). Prepare the journal entry for the transaction.

In accruing patient charges for the current month, which one of the following accounts should a hospital credit?

Which entry would be the correct entry to record that a hospital has provided patient services for $200,000, of which 25% will be billed to a third party?

Which of the following is not true about a merger of two not-for-profit organizations?

The Equity Method of Accounting for Investments

Consolidation of Financial Information

Consolidations-Subsequent to the Date of Acquisition

Consolidated Financial Statements and Outside Ownership

Consolidated Financial Statements - Intra-Entity Asset Transactions

Variable Interest Entities, Intra-Entity Debt, Consolidated Cash Flo

Consolidated Financial Statements - Ownership Patterns and Income

Segment and Interim Reporting

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Worldwide Accounting Diversity and International Standards

Financial Reporting and the Securities and Exchange Commission

Accounting for Legal Reorganizations and Liquidations

Partnerships: Formation and Operations

Partnerships: Termination and Liquidation

Accounting for State and Local Governments

Accounting for State and Local Governments

Accounting for Estates and Trusts

Filters