An Unconditional Pledge of Support Is Properly Recorded as Temporarily

question 131

Multiple Choice

An unconditional pledge of support is properly recorded as Temporarily Restricted Revenue at the time of the pledge. Changes in the present value of the receivable resulting from the passage of time is reported as:

• A) Interest income.
• B) Program revenue.
• C) Contribution revenue.
• D) Other comprehensive income/loss.

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Definitions:

Credit Standards

The criteria that lenders use to determine the creditworthiness of potential borrowers.

Sub-prime Loans

Loans offered to individuals with poor credit histories or higher risk of default, often at higher interest rates.

Mortgage Default Rate

The percentage of home mortgages on which the borrower is late by ninety days or more with the payments on the loan or it is in the foreclosure process. This rate is sometimes referred to as the serious delinquency rate.

Foreclosure Process

The legal procedure by which a lender attempts to recover the balance of a loan from a borrower who has defaulted on their mortgage payments by forcing the sale of the asset used as the collateral for the loan.