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:

Détente

A period of improved relations between two countries that were previously in conflict with each other, notably used to describe the easing of tensions between the United States and the Soviet Union during the Cold War era.

Nixon

37th President of the United States, known for his policy of détente with the Soviet Union and the scandal of Watergate that led to his resignation.

Kissinger

Refers to Henry Kissinger, a significant figure in American foreign policy, known for his role as Secretary of State and National Security Advisor during the Nixon and Ford administrations, his diplomacy tactics, and his contributions to international relations.

Détente-Style Diplomacy

A strategy aimed at easing geopolitical tensions between nations, characterized by negotiation and cooperation rather than confrontation.