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

question 39

Essay

a.Describe the basic accounting for private not-for-profit groups promoted by the FASB 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 a cash 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.

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Definitions:

Manager's Knowledge

The information, expertise, and skills that a manager possesses, which enable effective decision-making and leadership within an organization.

Social Responsibility

Refers to the ethical framework and obligation of an organization or individual to act for the benefit of society at large.

Society

A group of individuals living together in a more or less ordered community, often sharing customs, laws, and social institutions.