Question 1

Describe the four fundamental ways in which not-for-profit organizations differ from business enterprises. What are the reporting objectives of NFPs?

Accepted Answer

The answer of Describe the four fundamental ways in which...

Question 2

For a not-for-profit organization, an expenditure is ________.

Accepted Answer

A) any payment for expenses or to settle a liability 
B) a payment, a liability incurred, or a transfer of property to obtain goods or services 
C) any cost associated with the consumption of goods or services 
D) a capital acquisition only

Question 3

For the 20X6 fiscal year, KU Care, a not-for-profit organization, received $300,000 in unrestricted donations and $175,000 in donations designated specifically for cancer research. $200,000 of the unrestricted donations and $100,000 of the restricted donations were expended in 20X6 for current operations and cancer research, respectively. KU did not set up a separate fund for the restricted donation. Under the deferral method, how much of the donations should be reported as revenue in the statement of operations for the 20X6 fiscal year?

Accepted Answer

A) $300,000 
B) $375,000 
C) $400,000 
D) $475,000

Question 4

During the year, a not-for-profit art gallery acquired a number of pieces for its collection. Which of the following choices for reporting the acquisitions is not in accordance with the CICA Handbook?

Accepted Answer

A) Capitalize, but do not depreciate 
B) Capitalize and depreciate 
C) Immediate write-off 
D) Note disclosure only

Question 5

Which of the following statements is true?

Accepted Answer

A) The deferral method of accounting generally results in a lower level of revenue than the restricted fund method. 
B) The deferral method of accounting generally results in a higher level of revenue than the restricted fund method. 
C) The deferral method of accounting generally results in a higher level of revenue than the restricted fund method only if capital asset amortization is involved. 
D) The deferral method of accounting results in the same amount of revenue as the restricted fund method.

Question 6

When budgetary control accounts are first set up, ________.

Accepted Answer

A) budgeted revenues are credited and budgeted expenditures are debited 
B) actual revenues are credited and actual expenditures are debited 
C) budgeted revenues are debited and budgeted expenditures are credited 
D) actual revenues are debited and actual expenditures are credited

Exam 10: Financial Reporting for Not-For-Profit Organizations

Describe the four fundamental ways in which not-for-profit organizations differ from business enterprises. What are the reporting objectives of NFPs?

For a not-for-profit organization, an expenditure is ________.

During the year, a not-for-profit art gallery acquired a number of pieces for its collection. Which of the following choices for reporting the acquisitions is not in accordance with the CICA Handbook?

Which of the following statements is true?

When budgetary control accounts are first set up, ________.