The FASB States That Donated Services Should Be Recorded as Contributions

question 12

True/False

The FASB states that donated services should be recorded as contributions by a not-for-profit organization if they meet the recognition criteria and are material.

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Definitions:

Operating Activities

Activities that relate to the company's primary operations, including revenue generation, expenses, and cash flows.

Cash Dividends

Cash distributed by a corporation to its shareholders out of its earnings.

Net Cash

The amount of cash that remains after accounting for cash disbursements and receipts, indicating a company's liquidity position.

Operating Activities

Activities that constitute the primary or main activities of a business, like sales, provision of services, production, etc., which are reflected in the cash flow from operating activities in the financial statements.