A Not-For-Profit Organization That Follows FASB Standards Must Display the Changes

question 77

Multiple Choice

A not-for-profit organization that follows FASB standards must display the changes in all classes of net assets on which of the following statements?

• A) Statement of activities.
• B) Statement of financial position.
• C) Statement of cash flows.
• D) Statement of functional expenses.

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Definitions:

Vertical Equity

The principle that people with higher incomes should pay more in taxes than those with lower incomes, reflecting a progressive tax system.

Proportional Tax

A tax system where the tax rate remains constant regardless of the amount on which the tax is imposed.

Regressive Tax

A tax imposed in such a manner that the tax rate decreases as the amount subject to taxation increases.

Progressive Tax

A tax system where the tax rate increases as the taxable income or base increases, leading to a higher tax burden on wealthier individuals or entities.