Advanced Accounting 10th Edition by Thomas Schaefer, Joe Ben Hoyle, Timothy Doupnik

Exercise 22

A private not-for-profit university charges its students tuition of SI million.However, financial aid grants total $220,000.In addition, the school receives a $100,000 grant restricted for faculty salaries.Of this amount, it spent $30,000 appropriately this year.On the statement of activities, the school reports three categories: (1) revenues and support, (2) net assets reclassified, and (3) expenses.Which of the following is not true
a.Unrestricted net assets should show an increase of $30,000 for net assets reclassified.
b.In the unrestricted net assets, the revenues and support should total $1 million.
c.Unrestricted net assets should recognize expenses of $30,000.
d.Unrestricted net assets shows the $220,000 as a direct reduction to the tuition revenue balance.