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

What are the revenue recognition requirements for: (1)unconditional promises to give (i.e.pledges), (2)conditional promises to give, (3)multi-year pledges, (4)donated services,and (5)Donated materials or fixed assets.

In 2012,a major drug company agreed to give a not-for-profit private college $300,000 to perform testing of a new drug.An advance payment of $200,000 was received in 2012.The college was to receive $1,500 per individual test.In 2012,the college completed 100 tests.How much revenue should the college report for 2012?

Under which of the following conditions is it appropriate for a private not-for-profit to allocate the cost of mass mailings from fund raising to a program related activity,such as Public Education?

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

A private not-for-profit organization received a gift of $460,000 with purpose restrictions in 2011.In 2012 funds were expended for the purpose outlined in the gift,however,it was not possible to determine whether the restricted funds or unrestricted funds were used.The presumption should be:

When might it be appropriate for a not-for-profit organization to report a surplus (increase in net assets)?

A Statement of Functional Expenses is required for voluntary health and welfare organizations.

Which of the following financial statements are required for voluntary health and welfare organizations?

Which of the following is true regarding accounting and financial reporting for nongovernmental,not-for-profit organizations?

Below are the complete set of published financial statements taken from the annual report of the Jamestown Museum.The statements do not comply with generally accepted accounting principles for private not-for-profits in a number of ways.Review these statements and describe instances in which the statements fail to comply with accepted accounting standards.You must be able to justify your assertions - for example you cannot say they failed to capitalize leases if there is no evidence they have a qualifying lease. Example: (1)The financial statements contain no note disclosures.The notes are an integral part of the financial statements and many individual disclosures are required under FASB standards.

Expenditures,encumbrances,and budgetary accounts are not used by private not-for-profit organizations.

Which of the following statements is not correct with respect to contributions to a private not-for-profit?

A donor gave $60,000 to a nongovernmental,not-for-profit charity with instructions that the funds be transferred to Sam Smith,an individual who lost his home in a fire.The not-for-profit would:

How does a for-profit organization record contributions made to a private not-for-profit organization?

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

Which of the following is not a characteristic that distinguishes a private not-for-profit organization from a business?

State governments are required to prepare a Statement of Functional Expenses. FALSE

Donated services should be considered revenue if the service creates or enhances a nonfinancial asset and requires a specialized skill which would have had to be purchased if not donated.

A donor gave artwork to a nongovernmental,not-for-profit museum.The artwork qualified as a "collection," under FASB rules.The not-for-profit could:

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.).