Questions and Answers of Accounting For Governmental And Nonprofit Entities

Distinguish between the accounting treatment of time-restricted pledges by private and public sector colleges and universities.
What is the role of the National Association of College and University Business Officers in providing guidance in the reporting of colleges and universities?
Obtain the annual reports for a private not-for-profit and public college or university and answer the following questions:a. Examine the two activity statements (revenues and expenses). What are the
For the following transactions and events, indicate what effect each will have on the three classes of net assets using this format. Put an X in the appropriate column. If the net assets are
Assume a government leases equipment to be used in governmental activities under a noncancelable lease, meeting the requirements for classification as a capital lease. Where would the capital lease
Under the reporting model required by GASB Statement 34, fund statements are required for governmental, proprietary, and fiduciary funds. Government-wide statements include the Statement of Net
Under the reporting model required by GASB Statement 34, fund statements are required for governmental, proprietary, and fiduciary funds. Government-wide statements include the Statement of Net
Under the reporting model required by GASB Statement 34, fund statements are required for governmental, proprietary, and fiduciary funds. Government-wide statements include the Statement of Net
What are the major sources of funds for capital project and debt service funds, and how are the sources classified in the Statement of Revenues, Expenditures, and Changes in Fund Balance?
Following are transactions and events of the General Fund of the City of Springfield for the fiscal year ended December 31, 2017.1. Estimated revenues (legally budgeted)2. Appropriations3. Revenues
a. Distinguish between (1) exchange and (2) nonexchange transactions.b. Identify and describe the four eligibility requirements for a government to recognize revenue in a nonexchange transaction.c.
How should rainy day funds be reported?
Describe the net position classification appearing on the government-wide Statement of Net Position.
Chapters 2 through 9 deal with specific knowledge needed to understand accounting and financial reporting by state and local governments. A continuous problem is available in additional resources
Describe the “hierarchy of GAAP” for state and local governments.
What contingent liabilities arise from a health care organization's relations with third-party payors?
Obtain a copy of a recent operating budget document of a government.* Familiarize yourself with the organization of the operating budget document; read the letter of transmittal or any narrative that
Using the CAFR you obtained for Exercise 1-1, answer the following questions: a. Auditors. Was this CAFR audited by external certified public accountants (CPAs) or by state or local
The government-wide financial statements for the City of Arborland for a three-year period are presented on the following pages.Additional information follows: Population: Year 2011:
Utilizing the CAFR obtained for Exercise 1-1 and your answers to the questions asked in Chapters 1 through 9, assess the financial condition of the government. For purposes of this project, financial
Utilizing the CAFR obtained for Exercise 1-1 and your answers to the questions asked in Exercise 1–1 and the corresponding exercises in Chapters 2 through 8, comment on the following: a.
Multiple Choice. Choose the best answer.1. Which of the following is not a fiduciary fund? a. Permanent fund. b. Agency fund. c. Investment trust fund. d. Pension trust
Utilizing the annual report obtained for Exercise 1-1, follow these instructions: a. Agency Funds.Are employees' and employers FICA tax contributions and con tributions to other
Utilizing the comprehensive annual financial report (CAFR) obtained for Exercise 1-1, follow these instructions: a. Internal Service Funds. (1) Use of Funds. What
Utilizing the comprehensive annual financial report (CAFR) obtained for Exercise 1-1, follow the instructions below. a. General Long-term Liabilities. (1)
Utilizing the CAFR obtained for Exercise 1-1, answer these questions. a. General and Other Capital Assets: (1) Reporting of Capital Assets. Are capital
Utilizing the comprehensive annual financial report obtained for Exercise 1-1, follow these instructions. a. Governmental Activities, Government-wide Level. Answer the following
The finance director of the Town of Liberty has asked you to determine whether the appropriations, expenditures, and encumbrances comparison for Office Supplies for a certain year (reproduced as
Utilizing the CAFR obtained for Exercise 1-1, in Chapter 1, review the governmental fund financial statements and related data and government-wide financial statements. Note particularly these
Utilizing the CAFR obtained for Exercise/Problem 1-1, examine the financial statements included in the financial section and answer the following questions. If the CAFR you have obtained does not
Explain what is meant by the phrase, "A fund is a fiscal and an accounting entity."
Download a copy of the most recent comprehensive annual financial report (CAFR) for the city and county of Denver from its web site: https://www.denvergov.org/controller (click on "Financial
Using the annual financial report obtained for Exercise 1–1, answer the following questions:a. Examine the auditor’s report. Is the auditor identified as an independent CPA firm? A state audit
Use the Web sites provided in Illustration 13–7 to access your high school or school system school report card (or any other school report card of your choice). Answer the following
Using the annual financial report obtained for Exercise 1–1, answer the following questions:a. Report the following ratios, using the text material for the Village of Elizabeth as a guide:(1) Net
Obtain a copy of the annual report of a private college or university. Answer the following questions from the report. For examples, try:Baylor University:
Obtain a copy of the annual report of a private not-for-profit organization. Answer the following questions from the report (if obtaining a report online, use the site search or the “about us”
Obtain an annual report from a public college or university and answer the following questions:a. Does the institution report as a special-purpose entity engaged in (1) governmental- and
Under the reporting model required by GASB Statement 34, fund statements are required for governmental, proprietary, and fiduciary funds. Government-wide statements include the Statement of Net
Using the annual financial report obtained for Exercise 1–1, answer the followingquestions:a. Find the reconciliation between the governmental fund balances and thegovernmental-type activities net
Using the annual report obtained for Exercise 1–1, answer the followingquestions:a. Look at the Statement of Fiduciary Net Assets. Which fund types areinclud ed? Is the Statement prepared in a
Using the annual financial report obtained for Exercise 1–1, answer thefollowing questions:a. Find the Statement of Net Assets for the proprietary funds. Is the NetAsset or the Balance Sheet format
Using the annual financial report obtained for Exercise 1–1, answer the followingquestions:a. Examine the governmental fund financial statements. Are any major capitalprojects funds included? If
Using the annual financial report obtained for Exercise 1–1, answer the following questions:a. Look at the General Fund column of the Balance Sheet for governmental funds. What are the major
Using the annual report obtained for Exercise 1–1, answer the following questions.a. Look at the Statement of Revenues, Expenditures, and Changes in Fund Balances for the governmental funds. List
Chapters 2 through 9 deal with specific knowledge needed to understand accounting and financial reporting by state and local governments. A continuous problem is available on the text’s Web site
Using the annual financial report obtained for Exercise 1–1, answer the following questions:a. Report the following ratios, using the text material for the Village of Elizabeth as a guide:(1) Net
In partnership with Jefferson County, Mound City recently established a Native American Heritage Center and Museum, organized as a tax-exempt not-for-profit organization. Although the facility does
The Rural Assistance Agency operates three major programs as responsibility centers—the Food Bank, Housing Services, and Credit Counseling. Clients pay a fee for services on a sliding scale based
The complexity and uniqueness of the federal government make it difficult to conduct a meaningful analysis of its financial condition. However, conducting a financial statement analysis does provide
The trial balance of the Federal Antiquities Administration, as of August 31, 2023, follows: RequiredPrepare a statement of budgetary resources for the 11 months ended August 31, 2023, assuming
US has formed a workgroup to help develop a taxonomy for the eventual reporting of state and local government financial reports in XBRL format. Its website is
Community benefit is a critical factor in the determination of whether a hospital is granted 501(c)(3) status, which may result in significant savings in income and other taxes. IRC section 501(r)
Explain the difference between Budgetary Fund Balance and Fund Balances accounts.
Explain the difference between Budgetary Fund Balance and Fund Balances accounts.
Identify the authoritative accounting standard-setting bodies for governmental NFP organizations and nongovernmental NFP organizations.
Does the FASB require NFPs to report expenses by function, nature, or both? What is the value of reporting expenses by function and nature?
In reviewing the financial statements of your local art museum, you notice the museum’s collection of rare oil paintings is not recognized on the financial statements. Is the art museum following
What are joint costs, and how are joint costs recorded?
One of the requirements for a contribution to be considered conditional is if the agreement with the donor includes a barrier that must be overcome by the NFP. How would an NFP organization determine
In recent times, the FASB has issued several important updates to not-for-profit financial reporting including Accounting Standard Update (ASU) 2016-14, Presentation of Financial Statements of
For each of the NFP organization transactions listed, indicate which of the revenue or contribution classifications apply by choosing one or more of the letters from the listed items in the
The Atkins Museum recently hired a new controller. He was considered well qualified for the position given his experience with managerial accounting and his strong communication skills. The new
The Shannon Community Kitchen provides hot meals to homeless and low-income individuals and families; it is the organization’s only program. It is the policy of the Kitchen to use restricted
INVOLVE was incorporated as a not-for-profit organization on January 1, 2023. During the fiscal year ended December 31, 2023, the following transactions occurred.1. A business donated rent-free
The Learning Institute has presented its statement of financial position for the 2023 fiscal year.RequiredUpon reviewing the statement, you realize that it is not presented in compliance with the
A large donor has notified a private college of her decision to name the college as a beneficiary in her will. How will the college report the intention to give in its financial statements?
What is a split-interest agreement, and why do you believe a donor or a university would enter into such an agreement?
Discuss the process for recognizing revenue from tuition for private colleges and universities.
Elizabeth College, a small private college, had the following transactions in fiscal year 2023.1. Gross tuition and fees revenue totaled $5,600,000. Tuition waivers and scholarships of $346,000 were
The following is the preclosing trial balance for Allen University as of June 30, 2023. Additional information related to net assets and the statement of cash flows is also provided.Additional
The following balances come from the trial balance of Wilson State College as of the end of the 2023 fiscal year.Requireda. Prepare a statement of revenues, expenses, and changes in net position for
All health care entities follow the same set of accounting standards. Do you agree with this statement? Why or why not?
How do charity services, patient discounts, contractual adjustments, and provision for bad debts impact patient service revenue for government health care entities? Does the accounting treatment
What is premium revenue, and when is it recognized? Discuss the recognition of premium revenue relative to the matching concept in accounting.
Identify key financial indicators that can be utilized to evaluate the financial health of NFP hospitals. Are there any other metrics that are important to evaluate in determining the performance of
What is the diagnosis-related group (DRG), and how does it impact patient service revenue?
The following is the preclosing trial balance for Christina Rehabilitation Hospital as of September 30, 2023. Requireda. Prepare a statement of operations and a statement of changes in net
Discuss the intended audience for the consolidated financial report of the U.S. government. Does the FASAB identify any particular group as the primary audience?
In 2019, 22 of 24 CFO Act agencies received unmodified audit opinions. The Comptroller General disclaimed an opinion on one agency, and one received a qualified opinion. Choose one of the CFO Act
The City of Austin, Texas, maintains a website to report performance measures in the areas of public safety, community services, infrastructure services, utilities/major business enterprises,
The Commonwealth of Massachusetts maintains a website, termed a financial records transparency platform, that reports how and where tax dollars are utilized. Categories of revenues, spending, and
Choose the best answer.1. Which of the following statements regarding budgets of not-for-profit organizations is true?a. Not-for-profit organization budgets are legal documents reflecting plans for
The police chief of the Town of Meridian submitted the following budget request for the police department for the forthcoming budget year 2023–2024.Upon questioning by the newly appointed town
The City of Bancroft has produced a Service Efforts and Accomplishments report for the past three years for each of its operating departments. Key performance measurements for Bancroft’s public
Discuss how characteristics of not-for-profit organizations differ from those of for-profit organizations.
What type of NFPs are classified as 501(c)(3) tax-exempt organizations? What is a major difference between 501(c)(3) tax-exempt organizations and other tax-exempt organizations?
What information is reported on the Form 990? How would an NFP know which type of Form 990 it must file?
What are articles of incorporation, and how do they differ from bylaws of an NFP organization?
Discuss ways in which donors can evaluate the performance of NFP organizations.
Guidestar established Guidestar Platinum to allow organizations to share nonfinancial performance metrics. Organizations that choose to share nonfinancial performance metrics can receive a Platinum
You are considering making a contribution to the World Resources Institute. However, as an accountant, you decide to conduct “due diligence” related to the performance of the World Resources
Starting September 2011, Charity Navigator incorporated an Accountability and Transparency Performance Score into the overall evaluation of charities reviewed on its website. The Accountability and
The Let’s Read organization is a public charity under IRC section 501(c)(3). It had total support of the following: Of the $261,000 received from individuals, $240,000 came from four
What is the nature of enterprise fund restricted assets? Provide examples of items that might be reported in the Restricted Assets section of an enterprise fund statement of net position.
What are the three components of net position provided by the GASB? Describe how a government assigns amounts to the classifications.
The City of Cypress has prepared the following statement of cash flows for its sole proprietary fund. RequiredThe statement as presented is not in accordance with GASB standards. Identify the
When do GASB standards require interfund receivables and payables to be reported as Internal Balances?
Choose the best answer.1. GASB standards require a statement of cash flows fora. Internal service funds.b. Enterprise funds.c. All internal service funds and enterprise funds.d. Only internal service
Use the 2019 CAFR for the City and County of Denver to respond to the following questions. Requireda. Does the City and County of Denver report any internal service funds? If so, identify the

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