F8 - M5 - Not-for-Profit Revenue Recognition

Question 1

An __________ is one in which the not-for-profit organization earns resources in exchange for a service performed.

Answer 1

exchange transaction

Question 2

Revenues from not-for-profit exchange transactions are recognized when ____________.

Answer 2

realized or realizable and earned

Question 3

Revenues from exchange transactions are classified as ________________

Answer 3

revenue without donor restrictions.

Question 4

A _________ is defined as an unconditional transfer of cash or assets (collection is certain) to a new owner (title passes) in a manner which is voluntary (the donor is under no obligation to donate) and is nonreciprocal (the donor gets nothing in exchange)

Answer 4

contribution

Question 5

Contributions may include (4)

Answer 5

cash, services, and other assets.

Question 6

____________are recorded as revenues for the portion considered collectible after treating the entity’s estimate of uncollectibility as an allowance for uncollectible accounts.

Answer 6

Unconditional promises (pledges)

Question 7

Conditional promises are not recognized as revenue until the _____________.

Answer 7

condition has been satisfied.

Question 8

___________ are only recognized as revenue and an equal and offsetting expense SOME of the time.

Answer 8

Donated services

Question 9

The donated service must generally be a specialized service, otherwise needed and measured easily or enhance the value of a _________.

Answer 9

nonfinancial asset

Question 10

Donated collection items are subject to the same rules as for governments (e.g., __________); however, this is optional if the collection is exhibited, preserved, and proceeds of any sale are to be used to acquire other assets for the collection.

Answer 10

capitalized at fair value

Question 11

Donated materials (if deemed significant) increase ______ and _____ at ________ at the time of the donation.

Answer 11

assets; support (revenues) at fair value

Question 12

Donor-imposed restrictions limit the use of _____________

Answer 12

contributed assets.

Question 13

Donor imposed restricts are recognized as __________________in the period received and as ________________, depending on the form of the benefits received.

Answer 13

revenues, gains, and other support; assets, decreases of liabilities, or expenses,

Question 14

When a not-for-profit offers premiums (e.g., calendars, coffee mugs, tote bags, etc.) to donors as part of a fundraising campaign, the cost of the premiums is classified as a ______________.

Answer 14

fundraising expense.

Question 15

Generally, the difference between the _________by the donor and the _______ of any premiums transferred is classified as contribution revenue.

Answer 15

contribution made; fair value of any premiums transferred

Question 16

Tuition revenues are recorded at _____ amounts.

Answer 16

gross

Question 17

Gross revenue from tuition and fees is

determined by

Answer 17

subtracting canceled classes from assessed student tuition and fees.

Question 18

Any price breaks given to students such as scholarships or tuition waivers may be treated as an _____________

Answer 18

allowance that reduces revenues or as an expense.

Question 19

NFP health care organizations: _____________ are recorded at ___________ but displayed on the statement of activities net of deductions.

Answer 19

Patient service revenues; gross amounts

Question 20

____________ (charity care or other deep discounts that are generally provided based on poverty guidelines) are not recorded as ________ because there was no intention to collect.

Answer 20

Charitable services; revenues

Question 21

_________e may be treated as either an expense (with no effect on revenue) or as a ___________ depending on whether the organization made an assessment of quality or collectability of the related patient account receivable.

Answer 21

Bad debt expense; deduction from revenue

Question 22

___________ includes donated supplies/equipment, cafeteria revenue, parking fees, and gift shop revenue.

Answer 22

Other operating revenue

Question 23

_________ revenue includes all unrestricted gifts and donations plus donated services.

Answer 23

Nonoperating

Question 24

The conditional pledge to a non-governmental not-for-profit organization should be recognized as revenue when conditions regarding the pledge are met

Answer 24

when conditions regarding the pledge are met

Question 25

For colleges and universities, current funds revenues include (1) _________ and (2) ________________.

Answer 25

1) all unrestricted gifts and other unrestricted resources, 2)restricted current funds to the extent that such funds were expended for current operating purposes.

Question 26

Support services do not relate to the primary missions of the nonprofit organization and include such costs as (3)

Answer 26

management and general administration, membership development, and fund-raising.

Question 27

Tuition and fees are recorded as ______ at standard established rates, with amounts waived (such as scholarships or tuition remissions) recorded as _________

Answer 27

revenue; expenditures.

Question 28

Tuition and fees are recorded at standard established rates, with amounts waived (such as scholarships or tuition remissions) recorded as expenditures. Actual refunds of tuition or fees, however, should be recorded as a ________________

Answer 28

reduction of revenues

Question 29

For Colleges, There are separate functional classifications for expenditures (3)

Answer 29

“Institutional Support,” “Scholarships and Fellowships,” and “Operation and Maintenance of Plant.”