Exam 26: Not-For-Profit Organizations: Introduction and Private Npos

_____ Under FAS 117, how would the spending of money set aside in the prior year by the board of directors of a nonprofit organization to be used for a community service education project be reported in the current-year statement of activities?

For public C&Us engaged only in business-type activities, the three items that are reported as separate line items following the nonoperating revenues (expenses) section of the operating statement are (1) _______________________, (2) _________________________, and (3) ______________________________.

_____ On 5/5/05, a donor contributed an equity security having a $500,000 fair value. The donor stipulated that (a) the NPO may sell the equity security at any time and make other suitable investments, (b) the $500,000 endowment must remain intact in perpetuity, and (c) the income and gains may be spent only on diabetes research (no mention is made regarding the treatment of losses). The equity security had a fair value of $530,000 at 12/31/05 and $480,000 at 12/31/06. (No dividends were received in either year.) In early 2006, a portion of the equity security was sold for $30,000 cash. The NPO spent $22,000 cash on diabetes research in 2006. What is the change in the various categories of net assets for 2006 as a result of the decline in the equity security's market value in 2006?

Public C&Us have the option of following the guidance in GAS 34 that pertains to special purpose governments.

Under FAS 117, expirations of restrictions are reported _______________________________________________ in the statement of activities.

For a permanent endowment created by a cash donation, endowment investment dividends that can be spent only on medical research are reported as increases in TR net assets.

Promises with future payment dates would usually be classified as _____________________________________ contributions.

For a permanent endowment created by a cash donation, endowment investment dividends that can be spent in any manner are reported as increases in UR net assets.

_____ Under FAS 117, which of the following categories of net assets is not required to be shown in the statement of financial position?

_____ For a public C&U engaged in business-type activities, interest on capital debt is reported in which section of the following statements?

_____ Under FAS 117, income earned from endowments (permanent) that can be spent on only certain programs but that has not yet been spent would be reported in the statement of activities in the

_____ Which of the following statements is not presented by public HCOs?

_____ Under FAS 117, income earned from endowments (permanent) that can be spent on only certain programs and that was spent in the year earned would be reported in the statement of activities in the

_____ A nonprofit organization has been receiving free electricity from a local utility. How should the nonprofit organization account for this?

In determining the appropriate category of net assets in which to report endowment investment gains and losses, the last of three possible places to look is FAS 124, "Accounting for Certain Investments Held by Not-for-Profit organizations."

_____ Under FAS 116, which of the following contributions are not recognized in the statement of activities?

Under FAS 117, private nonprofit organizations must show three classes of net assets (equity) in their statement of financial position: (a) ______________________________, (b) ______________________________, and (c) __________________________.

Under FAS 116, the fair value of contributed services received but not recognized in the financial statements must be disclosed.

Public C&Us must report their operations using a statement of revenues, expenses, and changes in net assets.

Public HCOs need not present a statement of cash flows.