How Does the FASB Require Not-For-Profit Organizations to Report Expenses

question 48

Multiple Choice

How does the FASB require not-for-profit organizations to report expenses?

• A) Natural classification, such as salaries, rent, and supplies.
• B) Functional classification, such as program and support.
• C) Management has the option of reporting using natural classification or functional classification.
• D) Both natural classification and functional classification must be reported, one must be recognized on the face of the financial statements and one is reported in the notes to the financial statements.

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Definitions:

Reinforcer

Anything that follows a response and strengthens it or increases the probability that it will occur.

Behavior Frequency

The number of times a specific behavior is exhibited over a designated period, often used as a measure in behavioral studies.

Systematic Desensitization

A behavioral therapy technique used to reduce anxiety or fear towards a particular object or situation by gradually increasing exposure to the anxiety-provoking stimulus.

Self-help Groups

Peer-led groups designed to support individuals dealing with similar issues, challenges, or conditions by sharing experiences and offering mutual assistance.