Far module 6

Question 1

or strike relief at the discretion of the union’s executive board.

In United Together’s statement of activity for the year ended December 31, Year 1, what amount should be reported under the classification of revenues, gains, and other support without donor restrictions?

Answer 1

Per capita dues, initiation fees and sales of organizational supplies would all fall under without

Question 2

The components of net assets for a non for profit are classified as two ways with donor restriction and without donor restriction

Answer 2

with donor restriction and without donor restriction

Question 3

Which of the following classifications is required for reporting of expenses by all not-for-profit organizations?

Answer 3

Choice “B” is correct. A not-for-profit organization needs to report its expenses in the statement of activities by their functional classification (program classification, supporting activities, fund-raising, etc.) and disclose the expenses in a natural classification by function in the notes to the financial statements.

Question 4

If the board votes to hold something for a specific use it is

Answer 4

without donor restrictions board designated are not donor restricted

Question 5

Reclassifications of net assets appear on where in a non for profit

Answer 5

The statement of activiites

Question 6

Supporting services are

Answer 6

services other than program services

Question 7

In Year 1, Community Helpers, a private voluntary health and welfare organization, received a bequest of a $100,000 certificate of deposit maturing in Year 11. The testator’s only stipulations were that this certificate be held until maturity and that the interest revenue be used to finance salaries for a preschool program. Interest revenue for Year 11 was $8,000. When the certificate was redeemed, the board of trustees adopted a formal resolution designating $20,000 of the proceeds for the future purchase of equipment for the preschool program.

What should be reported as “contributions without donor restrictions” in the Year 11 statement of activity?

Answer 7

0

Question 8

On December 30, Year 1, Albert Altruistic donated $200,000 to the Carton Museum under the terms and conditions of a charitable remainder trust that guarantees Mr. Altruistic a life-time tax free annuity of $20,000 per year and bequeaths the remainder to Carton for use in their operations in furtherance of the mission of the museum. Independent actuaries have estimated that the museum’s liability has a present value of $84,250. As a result of his contribution, the Carton Museum would record the following on its December 31, Year 1, financial statements:show the journal entry to gett he answer

Answer 8

DR. Assets held in a charitable remainder trust 200,000
Cr.Liability under trust agreements84,250

Cr. Contributionnwith donor restrictions 115,750

Question 9

Tutition remisisons and scholarships would not be shown in gross revenue

Answer 9

Instead you record the revenue amount total received and tuition remission is an expense and scholarships are also an expense

Question 10

Contributions are only recognized as revenues when they are

Answer 10

unconditional

Question 11

Revenues are recorded without

Answer 11

aallowaances for uncollectible

Question 12

pledges are recorded with

Answer 12

allowaances for uncollectible subtracted out

Question 13

hospitala revenues

Answer 13

paatient service revenues other op revenues and nonop revenues
The three most generally used revenue classifications for a hospital are patient services revenues, other operating revenues, and nonoperating revenues. Other operating revenues are those generated by operations other than patient services. Revenues from educational programs would be classified as other operating revenues. Nonoperating revenues represent incidental earnings not related to the ongoing and central operations of the hospital. Gifts without donor restrictions would be classified as nonoperating revenues.

Question 14

Azim Services, a nongovernmental, not-for-profit organization, received dues of $100 from its members. Azim provided its members with a newsletter that had a $25 value. All other services were valued at $10 per member. What is the amount of contribution made to Azim by each member?

Answer 14

Choice “B” is correct. The difference between the contributions made by a donor and the fair value of any premium transferred is classified as contribution revenue. Contribution revenue is computed as follows:

Dues $100
Less: Newsletter fair value (25)
Other services (10)
Net contribution
$ 65

Question 15

Donaated property is recorded at

Answer 15

Its fair market value and recognized as support

Question 16

Which of the following bases of accounting should a government use for its proprietary funds in measuring financial position and operating results?Modified accrual or fullm accrual

Answer 16

Modified -no full acrrual yes

Question 17

Which of the following is not an accounting characteristic or focus of proprietary funds?

A.	 Budgetary accounts are reported in internal service funds.

B.	 Fixed assets and long-term debt are reported on the statement of net position.

C.	 The focus is on economic resources measurement.

D.	 Accrual accounting is used.

Answer 17

Budgetary accounts are reported in internal service funds.

Question 18

Which of the following funds of a governmental unit recognizes revenues only in the accounting period in which they become available and measurable in their fund financial statements? General r emterprise

Answer 18

General fund yes enterprise no