Chapter9ed21

Chapter9ed21 - Chapter 21 Test Bank ACCOUNTING FOR...

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Chapter 21 Test Bank ACCOUNTING FOR NOT-FOR-PROFIT ORGANIZATIONS Multiple Choice Questions LO1 1. A not-for-profit entity has all of the following characteristics except that it will a. operate for purposes other than to provide goods or service at a profit b. have a positive fund balance c. not possess ownership interests like a corporation d. receive significant contributions from providers who do not expect returns LO2 2. A governmental not-for-profit entity has which of the following characteristics? a. It must have a positive fund balance. b. It must only operate on US soil. c. A government can void tax regulations for the entity. d. A government can unilaterally dissolve the entity. LO2 3. A non-governmental not-for-profit unit is subject to: I.GASB II.FASB a. I.only b. II.only c. A combination of I and II depending on the entity’s purpose d. Neither I or II LO3 4. In accounting for private, not-for-profit organizations, revenues and expenses are reported at _________ amounts and most gains and losses are reported at ___________ amounts. a. net, gross b. gross, net c. gross, gross d. net, net 199
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LO3 5. When the temporary-use restriction on a charitable donation is satisfied, which of the following is not reported? a. net assets released from restrictions in changes in temporarily restricted net assets b. net assets released from restrictions on the statement of cash flows c. expenses as changes in unrestricted net assets d. net assets released from restrictions in changes in unrestricted net assets LO3 6. Under FASB not-for-profit accounting guidance, an unconditional transfer of cash or other assets to an entity, or a settlement or cancellation of its liabilities in a voluntary, non- reciprocal transfer, is called a(n): a. unconditional promise to give b. contribution c. conditional promise to give d. residual equity transfer LO3 7. Unconditional promises to give that include promises of payments due in future periods (next year or later) are reported as: a. unrestricted revenues b. a memorandum, until the year of the promised payment c. deferred revenues until payment is received d. restricted revenues LO3 8. A gift-in-kind, for which there is little or no discretion on disposition, should be accounted by a not-for-profit entity as: a. a special purpose contribution b. an exchange transaction c. an agency transaction d. a conditional promise to give LO4 9. Voluntary health and welfare organizations must report expenses classified by: a. restriction b. function and natural classification c. restriction and natural classification d. restriction, function and natural classification 200
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LO4 10. Which one of the following statements is not required for voluntary health and welfare organizations? a. statement of financial position
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Chapter9ed21 - Chapter 21 Test Bank ACCOUNTING FOR...

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