Revenues of a Not-For-Profit Organization Should Be Reported as

question 45

Multiple Choice

Revenues of a not-for-profit organization should be reported as

• A)Increases in one of the three categories of net assets.
• B)Increases in unrestricted net assets.
• C)Increases in temporarily restricted net assets.
• D)Increases in permanently restricted net assets.

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Definitions:

Required Rate

Often refers to the minimum expected rate of return on an investment, taking into account the risk level.

Markup

The amount added to the cost of a product to cover expenses and profit, resulting in the selling price.

Absorption Costing

By adopting this accounting model, all manufacturing costs including direct materials, direct labor, and both variable and fixed overheads, are rolled into the product’s cost.

Required Return

The minimum profit or yield that investors expect to earn on an investment.