Local Services,a Voluntary Health and Welfare Organization Had the Following

question 70

Multiple Choice

Local Services,a voluntary health and welfare organization had the following classes of net assets on July 1,20X8,the beginning of its fiscal year:
During the year ended June 30,20X9,the following events occurred:
(1) It purchased equipment,costing $100,000,with contributions restricted for this purpose.The contributions had been received from donors during June of 20X8.
(2) It received $130,000 of cash donations which were restricted for research activities.During the year ended June 30,20X9,$90,000 of the contributions were expended on research.
(3) It sold investments classified in the net assets with donor restrictions class for a loss of $40,000.Dividends and interest income earned on the investments amounted to $70,000.There were no restrictions on how investment income was to be used.
(4) It received cash contributions of $200,000 from donors who did not place either time or use restrictions upon their donations.
(5) Expenses,excluding depreciation expense,for program services and supporting services incurred during the year ended June 30,20X9,amounted to $260,000.
(6) Depreciation expense for the year ended June 30,20X9,was $80,000.
-Refer to the above information.Which of the following statements is (are) correct about the program and supporting expenses that would be reported on the statement of activities for the year ended June 30,20X9?
I.Program and supporting expenses should be reported at $340,000.
II.All of the program and supporting expenses should be reported as a deduction from revenues without donor restrictions and other support.

• A)I only
• B)II only
• C)I and II
• D)Neither I nor II

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Definitions:

Oligodendroglial Cell

A type of glial cell in the central nervous system responsible for the formation and maintenance of myelin sheaths around neurons.

Schwann Cell

A type of glial cell located in the peripheral nervous system that wraps around nerve fibers, forming the myelin sheath which speeds up electrical impulses.

Astrocyte

A type of glial cell in the brain that provides support and nutrition to neurons, maintains the blood-brain barrier, and plays a role in the repair and scarring process of the brain and spinal cord.

Efferent

Referring to nerve fibers that carry signals away from the central nervous system to effectors such as muscles and glands.