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

What are the financial statements required for all nongovernmental, not-for-profit organizations?

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

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

Investments by private not-for-profit organizations in equity securities should be carried at

Which of the following is not true regarding the Statement of Activities for nongovernmental, not-for-profit organizations?

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

As of December 31, 2016, The Halifax Fishing Museum had unrestricted cash of $52,000, building and land with a net book value of $145,000, and permanently restricted collections totaling $ 105,000. There were no liabilities. The Museum has two programs: Operation of a Fishing Museum and Educational Programs. During the year ended December 31, 2017 the Museum incurred the following transactions: 1) Cash contributions to the Museum included a) unrestricted $ 512,000, b) restricted for educational programs $ 37,000 and c) restricted by the donor for endowment purposes $120,000. 2) Additional unrestricted cash receipts included $ 29,000 in fees from individuals and organizations using the Museum building as a meeting facility. Included in this is $ 3,000 for a meeting to be held in January 2016. 3) Incurred cash expenses: Item Total Amount Portion for Museum Operations Portion for Education Programs Admin. Utilities - programs 60,000 35,000 25,000 Utilities - administration 25,000 25,000 Salaries - programs 170,500 150,000 20,500 Salaries - administration 45,000 45,000 Supplies - programs 104,000 94,000 10,000 Supplies - administration 7,000 7,000 41,500 279,000 55,500 77,000 4) Purchased land for future expansion to the adjoining lot in the amount of $ 35,000. 5) Depreciation on the Museum building amounted to $ 55,000 and is allocated on the basis of square feet: $ 40,000 to Museum operations, $ 5,000 to Education Programs, and $ 10,000 to administration. 6) Outstanding purchase orders for administrative supplies at 12-31-2017 totaled $2,000. Required: Prepare a Statement of Activities and Changes in Net Assets for the Museum for the year ended 12-31-2017.

FASB Statement 124, Accounting for Certain Investments of Not-for-Profit Organizations:

A private not-for-profit's expenses are reported by, program or supporting, in the Statement of Activities or in the notes.

Contributions to a private not-for-profit are recorded at fair market value at the date of receipt.

An unconditional pledge of support is properly recorded as Temporarily Restricted Revenue at the time of the pledge. Changes in the present value of the receivable resulting from the passage of time is reported as:

Which of the following is not an example of a donor imposed restriction?

The financial reporting system for private not-for-profits must address the fact that donors often impose restrictions on the use of contributed resources.

A conditional pledge should be recognized as revenue when the pledge is made.

Under FASB Statement 116, reclassifications of net assets are not made:

A Statement of Functional Expenses presents a matrix of expenses classified by function and by object or natural classification.

Which of the following statements is correct with respect to contributions restrictions?

A benefactor promises to donate $25,000 to his church toward the purchase of a new piano if the church is able to raise matching funds of $25,000 from other contributors. At what point should the church record revenue? A) When the matching funds are raised. B) When the benefactor makes his pledge, as long as collection is reasonably assured. B) When the piano is purchased. D) When the benefactor pays the $25,000 to the church.

Which of the following statements is not accurate with respect to private not-for-profits?

The Statement of Functional expenses presents a matrix of expenses classified by function various programs, fund-raising, etc. and by object or natural classification salaries, supplies, travel, etc..