ACCTING GOV.NONPROFIT W/CONNECT
18th Edition
ISBN: 9781264035557
Author: RECK
Publisher: MCG
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Textbook Question
Chapter 1, Problem 19.10EP
The primary reason that not-for-profit (NFP) organizations should report expenses incurred for program purposes separately from those for supporting services such as management and general and fund-raising is that
- a. GASB standards require it.
- b. Program managers need information about the cost of activities for which they are responsible.
- c. Top managers need to know how much they are spending for nonprogrammatic management and general support.
- d. Donors, potential donors, oversight bodies, and others need to know what percentage of total expenses are being incurred for carrying out the NFP’s programs.
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The cornerstone of external financial reporting for governmental units and not-for-profit organizations is:
a.
to show the flow of financial resources
b.
to determine profit or loss
c.
to compare budgeted to actual resources
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accountability
The board of directors of Earth Rock's!, a nonprofit organization focused on environmental protection, hypothesizes that individuals are more likely to donate if they see evidence that their donations are used primarily for program activities rather than administrative and fund-raising costs. To get a sense of how its own cost structure compares to other groups, the board decides to benchmark the financial performance of Earth Rocks! against several other environmental organizations. The data for Earth Rocks! and the other environmental organizations appear below
Program Expenditures
Fund-raising Costs
Administrative Costs
Total Costs
Earth Rocks
374,900
98,000
121,400
594,300
Weed Lovers
421,000
104,300
98,350
623,650
Flora and Fauna
353,000
97,600
71,840
522,840
Leaf It Be
501,900
89,000
109,750
700,650
Nature's Gift
455,470
71,000
82,450
608,920
Use these data to benchmark Earth Rocks! against the other environmental organizations. How does Earth Rocks! compare to…
Which of the following accounting rules apply to all not-for-profit organizations? (Select all that apply.)
The financial statements must include a statement of functional expenses
The balance sheet must segregate assets according to restrictions on their use.
The balance sheet must segregate current assets from long-term assets.
The balance sheet must show reserves for likely amount of bad debts.
Equipment must be reported net of accumulated depreciation.
The activity statement must report expenses as decreases in net assets with donor restrictions.
The activity statement must segregate revenues according to restrictions on their use.
Chapter 1 Solutions
ACCTING GOV.NONPROFIT W/CONNECT
Ch. 1 - Prob. 1QCh. 1 - Prob. 2QCh. 1 - Prob. 3QCh. 1 - Prob. 4QCh. 1 - Explain the meaning and significance of...Ch. 1 - Prob. 6QCh. 1 - Prob. 7QCh. 1 - What are the three sections of a comprehensive...Ch. 1 - Prob. 9QCh. 1 - Prob. 10Q
Ch. 1 - Prob. 11CCh. 1 - Prob. 12CCh. 1 - Prob. 13CCh. 1 - Prob. 14CCh. 1 - Prob. 16CCh. 1 - Prob. 18EPCh. 1 - Prob. 19.1EPCh. 1 - Prob. 19.2EPCh. 1 - Prob. 19.3EPCh. 1 - Prob. 19.4EPCh. 1 - Prob. 19.5EPCh. 1 - Prob. 19.6EPCh. 1 - Prob. 19.7EPCh. 1 - Prob. 19.8EPCh. 1 - Prob. 19.9EPCh. 1 - The primary reason that not-for-profit (NFP)...Ch. 1 - Matching. (LO1-1, LO1-2, LO1-4, LO1-5) For each...Ch. 1 - Prob. 21EP
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