Nonprofit Final – Flashcards
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Which of the following ratios would be most helpful in assessing the operating position of a governmental entity?
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General fund balance/operating revenues.
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Which of the following ratios would be considered favorable if it was low?
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Debt service to total revenues.
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A measure of the adequacy of the amount of the government's total unrestricted net position or deficit at the measurement date is
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Unrestricted net position/total revenues
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The term that is closely related to the concept of liquidity is
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finacial position
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Which ratio or concept describes the extent to which the government has lived within its means for the year?
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Interperiod equity
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Which of the following is a measure of the extent to which the government's business type activities are self-supporting?
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Business type activities revenues/ business type activities expenses
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Which of the following statements about credit analysts' models is true?
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Credit analysts are concerned with assessing a government's ability to pay interest and principal on debt when due.
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Which of the following would be considered contribution revenue or support of a not for profit organization
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Monies received from a fund raising campaign.
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A donor provides a large cash contribution that is to be used for acquisition of a new building. Under FASB standards, how would this contribution be reported by a not-for-profit organization on its statement of cash flows?
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Financing activity
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Depreciation expense in a not-for-profit organization should be
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Assigned to or allocated to the functions to which it relates.
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Investments in equity securities that have a readily determinable market value and all debt securities of a not for profit organization are reported at
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fair value
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An example of an increase in net assets for a not-for-profit organization that would be labeled revenue rather than support is
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Investment income.
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A not-for-profit organization that follows FASB standards must display the changes in all classes of net assets on the
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Statement of activities.
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The FASB Codification requires the following financial statements for all nongovernmental, not-for-profit organizations
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Statement of financial position, statement of activities, and statement of cash flows.
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When a nongovernmental not-for-profit organization spends money for the purpose for which an external donor intended, then the expense is reported as a
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Decrease in unrestricted net assets.
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Under FASB standards how would a not-for-profit organization recognize a conditional pledge?
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It would not recognize the conditional pledge until pledge conditions are substantially met.
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A not-for-profit organization incurred $10,000 in management and general expenses in the current fiscal year. In the organization's statement of activities prepared in conformity with FASB standards, the $10,000 would be reported as
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Supporting services expenses.
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Which of the following statements is true regarding fund accounting for not-for-profit organizations (NFPs)?
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Fund accounting can provide a good mechanism for facilitating reporting to donors.
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Temporarily restricted net assets are released from restrictions
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As assets are spent for the purposes intended by the donor.
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An alumnus donates securities to a private college and stipulates that the principal be held in perpetuity and income from the securities be used for faculty travel. Dividends received from the securities should be recognized as increases in
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Temporarily restricted net assets.
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A college has collected returnable dormitory room deposits from students. How would these deposits be reported by the college?
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A current Liability
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Colleges and universities often make loans to students. How would these loans be reported on the financial statements?
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A receivable.
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What type of college or university must report expenses by functional classification?
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Private colleges and universities.
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Which of the following measures may be useful to decision makers evaluating the financial condition of a college or university?
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Current ratio.
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Which of the following is a typical classification of a functional expense in a college or university?
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Institutional support.
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Which of the following receipts may properly be accounted for as an increase in unrestricted net assets by a private college?
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Student tuition and fees.
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Which of the following items would not affect the amounts reported in the Revenues and Gains section of the statement of activities for a private college or university?
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Deferred revenues.
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Which of the following is required as part of a complete set of financial statements for a private college or university?
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Statement of changes in operations.
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Cactus College, a small private college, received a research grant from NACUBO to study whether service efforts and accomplishments measures improve institutional performance. In accordance with FASB standards the grant would be reported as an increase in:
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Temporarily restricted net assets.
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Which of the following is not a classification of revenues for a college or university as recommended by the National Association of College and University Business Officers (NACUBO)?
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Sporting events.
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A private college would report which of the following assets differently than a public college?
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Intangible Assets
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State educational appropriations received by a public university are classified as which of the following on the statement of revenues, expenses, and changes in net position?
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Nonoperating revenue.
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Contractual adjustments that arise from differences between the gross charge for patient services and the amount paid by a third party payer are reported as
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Deductions from gross patient revenue in arriving at net patient revenue.
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Where does a nongovernmental not-for-profit health care entity report increases that have occurred in its temporarily restricted net assets?
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Statement of changes in net assets.
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Contractual Adjustments is properly characterized as
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A contra revenue.
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Which of the following is not a financial statement prepared by nongovernmental not-for-profit health care entities?
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Statement of revenues, expenses, and changes in net assets.
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The primary source of revenue for most hospitals is
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Exchange transactions, such as fees for services.
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Which of the following would usually be considered as temporarily restricted net assets in a nongovernmental not-for-profit hospital?
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A research grant from the federal government to study high blood pressure.
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Which of the following would be considered an asset limited as to use?
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Cash the board of directors has designated for equipment acquisitions.
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Charity service and bad debts in a public hospital that follows business-type accounting are
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Reported differently, with charity service disclosed in the notes to the financial statements and bad debts reported as a deduction from revenue.
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Which of the following volunteer service is most likely to be reported by a private hospital as contribution revenue and an expense?
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Nurses from a religious organization who volunteer to assist in the care of critically ill children.
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The statement of activities required by FASB standards for not-for-profit health care entities must display changes for the period in which of the following categories of net assets?
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Unrestricted, temporarily restricted, and permanently restricted.
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Independent health care organizations that associate for the specific purpose of obtaining financing are called a(an)
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Obligated group.
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How would the cash acquisition of equipment be reported on a health care entity's statement of cash flows?
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Investing activity applying FASB standards.
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Which of the following could be included in the performance indicator measure provided by a nongovernmental not-for-profit hospital?
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Gain on sale of equipment.
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