Which of the Following Statements Is (Are)true Regarding Public Colleges

question 38

Multiple Choice

Which of the following statements is (are) true regarding public colleges and universities choosing to report as special-purpose entities engaged in business-type activities only?

• A) Endowments would be reported in the Statement of Net Assets as Net Assets Restricted-Nonexpendable.
• B) Capital appropriations from state governments are shown, in the Statement of Revenues, Expenses, and Changes in Net Assets, as a category separate from revenues.
• C) Both of the above.
• D) Neither of the above.

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Definitions:

Capital Expenditures

The costs of acquiring fixed assets, adding to a fixed asset, improving a fixed asset, or extending a fixed asset’s useful life.

Fixed Asset

Long-term tangible property that a company owns and uses in its operations to generate income, such as buildings, machinery, and equipment, which are not expected to be consumed or converted into cash within a year.

Property, Plant, Equipment

Long-term assets held for business use and not intended for resale, such as buildings, machinery, and vehicles, subject to depreciation.

Depreciated

A decrease in the value of an asset over time due to wear and tear or obsolescence.