Sample%20Exam%20#3%20F2010%20Solution

Sample%20Exam%20#3%20F2010%20Solution - Name:_KEY_...

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Name:___KEY____________ Accounting 456/556 Fall 2010 Third Midterm: 100 points possible Exam Instructions: 1. This is a closed book/ no notes exam. 2. You will not be allowed to leave the room and come back once you have begun the exam. 3. Make sure your exam contains 8 pages, including this page, plus a blank piece of legal size paper. 4. All pages of this exam must be submitted—even if left blank. 5. Good luck! 1
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Multiple Choice (50 points—2 ½ points each) Circle the best answer 1. Nongovernment not-for-profit organizations are required to report their financial statements on a. a current financial resources measurement focus. b. an economic resources measurement focus. c. a cash measurement focus. d. None of the above. 2. A not-for-profit organization was the recipient of a significant fixed asset donation. The asset, a building valued at $82,000, and one acre of land, valued at $210,000, is going to be used by the organization for office space and parking. The donor’s net book value of the building was $22,000, and the land basis was $65,000. The not-for-profit organization’s total basis for the assets should be a. $0 b. $87,000 c. $104,000 d. $147,000 e. $292,000 3. The local chapter of the Cure Juvenile Diabetes Association has two significant fundraising events each year in addition to their annual pledge drive - a black tie gala and a golf tournament. In 20X7, ticket sales to the gala were $532,000 (direct costs totaled $302,000). In that same year, the golf tournament generated revenues of $175,000 (direct costs totaled $45,000). The statement of activities should report a. special fundraising events revenue of $707,000 with an associated expense deduction of $347,000 reported in the revenue section of the statement of activities. b. special fundraising events revenue of $707,000 reported in the revenue section of the statement of activities. c. special fundraising events expenses of $347,000 reported in the expenses section of the statement of activities. d. Either item a separately OR items b and c together. e. Items b and c only. 4. A not-for-profit organization receives donated supplies valued at $40,000 in June. Assume that as of the fiscal year end in December the organization had used 25% of the materials. The organization should report a. restricted contributions of $40,000 and no expenses. b. restricted contributions and expenses of $40,000. c. unrestricted contributions of $40,000 and expenses of $10,000. d. unrestricted contributions and expenses of $10,000. e. unrestricted contributions of $10,000 and no expenses. 2
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5. In 20X8 the following pledges were made - $35,000 in unrestricted contributions for use in 20X8, $20,000 in contributions restricted for use in 20X9, and a $400,000 contribution restricted for the establishment of a permanent endowment. It is anticipated that 10% of all pledges
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Sample%20Exam%20#3%20F2010%20Solution - Name:_KEY_...

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