If a Not-For-Profit Organization Uses the Restricted Fund Method of Reporting

question 40

Multiple Choice

If a not-for-profit organization uses the restricted fund method of reporting and has a capital fund, how should a donation of cash restricted to the purchase of land be reported?

• A) As revenue in the general fund.
• B) As revenue in the capital fund.
• C) As a direct increase in net assets in the general fund.
• D) As a direct increase in net assets in the capital fund.

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Definitions:

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