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Extra Credit Exam Questions And 100% Correct Answers | Verified
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Extra Credit Exam Questions And 100% Correct Answers | Verified
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Extra Credit Exam Questions And 100%Correct Answers | Verified
During 2016, Angel Wings, a private voluntary health and welfare organization, received
the following donated services. Which of these services would not be recorded as an
increase in revenue without donor restrictions?
A) A carpenter donated labor and materials for the construction of a deck.
B) An attorney provided free advice related to creation of a new endowment fund.
C) A CPA firm donated its services to audit the financial statements for the past year.
D) A retired accounting professor donated reading services to senior citizens.
CORRECT ANSWERS D
The Jones family lost its home in a fire. On December 25, 2017, a philanthropist sent
money to the Amer Benevolent Society, a not-for-profit organization, to purchase
furniture for the Jones family. During 2018, Amer purchased this furniture for the Jones
family. How should Amer report the receipt of the money in its 2017 financial
statements?
A) As contribution revenue without donor restriction.
B) As contribution revenue with donor restriction.
C) As a liability.
D) Amer does not need to record anything related to this transaction. CORRECT
ANSWERS C
Save the Planet, a private nonprofit research organization received a $500,000
contribution from Ms. Susan Clark. Ms. Clark stipulated that her donation be used to
purchase new computer equipment for Save the Planet's research staff. The
contribution was received in August of 2018 and the computers were acquired in
January of 2019. For the year ended December 31, 2018, the $500,000 contribution
should be reported by Save the Planet on its:
A) Statement of activities as contribution revenue without donor restrictions.
B) Statement of activities as deferred revenue.
C) Statement of activities as contribution revenue with donor restrictions.
D) Statement of financial position as deferred revenue. CORRECT ANSWERS C
A not-for-profit organization is exempt from reporting which of the following contributed
services as revenue?
A) A CPA prepares the organization's tax return.
B) A special education teacher tutors children with learning disabilities.
C) A carpenter builds shelves for the office.
, D) An attorney solicits contributions on behalf of the organization CORRECT
ANSWERS D
Functional expenses recorded in the general ledger of XYZ, a nongovernmental not-for-
profit entity are as follows:
Soliciting prospective members: 45,000
Printing membership benefits brochures: 30,000
Soliciting membership dues: 25,000
Maintaining donor list: 10,000
What amount should XYZ report as fundraising expenses?
A) $10,000
B) $35,000
C) $70,000
D) $110,000 CORRECT ANSWERS A
Birdlovers, a community foundation, incurred $5,000 in management and general
expenses during Year 1. in Birdlovers' Statement of Activities for the year ended
December 31, Year 1, the $5,000 should be reported as:
A) a contra account offsetting revenue and support.
B) part of program services.
C) part of supporting services.
D) a direct reduction of net assets with donor restrictions. CORRECT ANSWERS C
Kind Nurses Assoc. is a voluntary health and welfare organization. Nurse are paid to
visit homes of elderly people and are reimbursed for mileage and supplies. Which of the
following items should Kind record as part of support activity expenses in its statement
of activities?
A) Nurse's mileage expense.
B) Payment for nurse's employee benefits.
C) Payment for nurse's supplies. D) Fundraising costs CORRECT ANSWERS D
A local voluntary health and welfare organization had the following expenses:
Administrative salaries: $20,000
Work to help elderly citizens: $60,000
Fundraising costs: $5,000
Childcare services provided for
indigent families: $40,000
How should these items be reported by the organization?
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