Nongovernment, Not-For-Profit Organizations Use the Following Classifications to Report Expenses

question 30

Multiple Choice

Nongovernment, not-for-profit organizations use the following classifications to report expenses in the statement of activities

• A) Changes in net assets without donor restrictions and changes in net assets with donor restrictions.
• B) Operating and nonoperating.
• C) Management and general and supporting services.
• D) Mission critical, non-mission-critical, and discretionary.

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Definitions:

Ending Inventory

The sum value of merchandise on offer for sale upon the conclusion of an accounting term.

Retail Value

The price point at which goods are sold to consumers, typically set higher than the wholesale price to cover costs and generate profit.

Average Cost Retail Inventory Method

An inventory valuation method that determines the cost of ending inventory and cost of goods sold based on the average cost of all similar items in the inventory.

Cost-to-retail Percentage

A method used in inventory valuation that compares the cost of goods to their retail price to calculate inventory value.