The FASB States That If a Not-For-Profit Has a Controlling

question 39

True/False

The FASB states that if a not-for-profit has a controlling interest in another not-for-profit it should consolidate the not-for-profit over which it has a controlling interest into its financial statements.

---

Definitions:

Compounded Semi-annually

Refers to the process where interest is added to the principal balance of an investment or loan twice a year, resulting in the interest earning interest.

Perpetuity

A financial instrument that pays a fixed amount of money indefinitely, with no end date.

Annually Compounded

A method of calculating interest where the interest is added to the principal sum once a year, resulting in interest on interest.

Fair Market Value

The price at which an asset would trade in a competitive auction setting, reflecting the true value as agreed upon by a willing buyer and seller.