Describe the Basic Accounting for Private Not-For-Profit Groups Promoted by FASB

question 7

Essay

Describe the basic accounting for private not-for-profit groups promoted by FASB Statement No. 117 including a brief description of the three net asset classes.
b. Indicate in which of the net asset classes the following transactions belong:
1. Donor makes gift to not-for profit which must be invested and maintained in perpetuity
2. Income Earned on donation noted in item #1 is restricted to certain program expenditures
3. Gains/Losses, both realized and unrealized, on donation noted in item #1. Not stipulated in donor agreement or by the law
4. Expenses paid out for programs stipulated in donor agreement relating to donation made in item #1.

---

Definitions:

Troposphere

The lowest layer of Earth's atmosphere where weather occurs and where most aviation takes place.

Stratosphere

The layer of the Earth's atmosphere above the troposphere, extending from about 10 to 50 km above the Earth's surface, where ozone is concentrated.

Volatile Organic Compound

Organic chemicals that have a high vapor pressure at ordinary room temperature, causing significant vapor emissions that can affect air quality and human health.

Benzene

A volatile, colorless, and highly flammable liquid hydrocarbon, used as a solvent and in the manufacture of various chemicals, known for its carcinogenic properties.