Ch 11 to 14 Final GOV/NFP UPDATED
ACTUAL Exam Questions and CORRECT
Answers
1. Private colleges and universities are (primarily) subject to financial reporting standards issued
by?
A) GASB.
B) FASB.
C) AICPA.
D) None of the above. - CORRECT ANSWER -B
2. Public colleges and universities are (primarily) subject to financial reporting standards issued
by:
A) GASB.
B) FASB.
C) AICPA.
D) None of the above. - CORRECT ANSWER -A
3. Private universities follow the authoritative standards of _____ and use the _____ basis of
accounting.
A) FASB, Accrual.
B) FASB, Modified-accrual.
C) GASB, Accrual.
D) GASB, Modified-accrual. - CORRECT ANSWER -A
A government owned college follows whose standards?
A. FASB because GASB doesn't have standards for universities.
B. GASB.
C. AICPA
,D. None of the above. - CORRECT ANSWER -B
In addition to a Statement of Financial Position and a Statement of Activities, a private college or
university is required to present:
A) A Statement of Functional Expense.
B) A Statement of Cash Flows.
C) Both (a) and (b).
D) Neither (a) nor (b). - CORRECT ANSWER -B
Private colleges are required to report net assets in the following categories:
A) Unrestricted and Restricted
B) Temporarily Restricted , Permanently Restricted and Unrestricted
C) Unrestricted, Temporarily Restricted and board designated
D) Restricted, Unrestricted and Temporarily Restricted - CORRECT ANSWER -B
The three classes of net assets required to be presented by a private college or university are:
A) Permanently Restricted, Temporarily Restricted, and Unrestricted.
B) Reserved, Unreserved, and Undesignated.
C) Invested in Capital Assets net of Related Debt, Restricted, and Unrestricted.
D) Educational and General, and Auxiliary Enterprises - CORRECT ANSWER -A
If a donor were to contribute money with instructions that the funds be invested for a period of
time and then released to be used for any purpose, this would be called a(n):
A) Permanent endowment
B) Term endowment
C) Quasi-endowment
D) Unrestricted endowment - CORRECT ANSWER -B
,Which of the following would not be correct with respect to accounting for colleges and
universities under the jurisdiction of the FASB?
A) If both unrestricted and restricted resources are available for a restricted purpose, the FASB
requires that the institution recognize the use of unrestricted resources first
B) Accrual accounting is used. Revenues and expenses are reported at gross amounts and gains
and losses are reported net.
C) Expenses are reported by function, either in the statements or in the notes
D) If an institution decides not to capitalize museum and other inexhaustible collections, note
disclosures are required regarding the collections - CORRECT ANSWER -A
Which of the following would not be correct with respect to accounting for colleges and
universities under the jurisdiction of the FASB?
A) Contributed services should be recognized only when the services create or enhance
nonfinancial assets or require specialized skills, are provided by an individual possessing those
skills, and would typically be purchased if not provided by donation
B) Multiyear pledges are recorded as restricted revenue and receivable for the gross amount of
the pledge when the pledge is made
C) Depreciation is recorded
D) Investments in stock with determinable fair values and all debt securities are reported at
market value - CORRECT ANSWER -B
According to the FASB, plant acquired by colleges and universities with either unrestricted or
restricted resources are recorded as:
A) Restricted
B) Unrestricted
C) Initially as temporarily restricted and reclassified as unrestricted in accordance with the
depreciation schedule
D) Either B or C - CORRECT ANSWER -D
When a private college or university has a foundation, and that foundation receives contributions
specifically directed for the benefit of the college or university,
A) The college or university records no revenue until monies are received from the foundation
, B) At the time of the contribution to the foundation, the college or university records an increase
in net assets and unearned revenue. When the money is received the unearned revenue is reduced
and revenue is recorded.
C) The college or university must recognize its interest in the contribution as an asset and
revenue at the same time as the foundation.
D) None of the above - CORRECT ANSWER -C
13. How should the following revenues be reported by a private college?
− $1,500 state appropriations,
− $5,600 in unrestricted contributions,
− $600 unrestricted investment income on endowment investments,
− $11,600 sales of services by auxiliary enterprises.
Unrestricted Restricted
A) 19,300 0
B) 17,800 1,500
C) 17,200 2,100
D) 5,600 13,700 - CORRECT ANSWER -A
14. The FASB has the authority to set accounting standards for all of the following organizations
except:
A) Public colleges.
B) Private colleges.
C) For profit proprietary schools.
D) Educational foundations established to support a private college or university. - CORRECT
ANSWER -A
15. Which of the following is a required statement for a private college?
A) Statement of Changes in Fund Balance.
B) Statement of Revenues and Expenditures.
ACTUAL Exam Questions and CORRECT
Answers
1. Private colleges and universities are (primarily) subject to financial reporting standards issued
by?
A) GASB.
B) FASB.
C) AICPA.
D) None of the above. - CORRECT ANSWER -B
2. Public colleges and universities are (primarily) subject to financial reporting standards issued
by:
A) GASB.
B) FASB.
C) AICPA.
D) None of the above. - CORRECT ANSWER -A
3. Private universities follow the authoritative standards of _____ and use the _____ basis of
accounting.
A) FASB, Accrual.
B) FASB, Modified-accrual.
C) GASB, Accrual.
D) GASB, Modified-accrual. - CORRECT ANSWER -A
A government owned college follows whose standards?
A. FASB because GASB doesn't have standards for universities.
B. GASB.
C. AICPA
,D. None of the above. - CORRECT ANSWER -B
In addition to a Statement of Financial Position and a Statement of Activities, a private college or
university is required to present:
A) A Statement of Functional Expense.
B) A Statement of Cash Flows.
C) Both (a) and (b).
D) Neither (a) nor (b). - CORRECT ANSWER -B
Private colleges are required to report net assets in the following categories:
A) Unrestricted and Restricted
B) Temporarily Restricted , Permanently Restricted and Unrestricted
C) Unrestricted, Temporarily Restricted and board designated
D) Restricted, Unrestricted and Temporarily Restricted - CORRECT ANSWER -B
The three classes of net assets required to be presented by a private college or university are:
A) Permanently Restricted, Temporarily Restricted, and Unrestricted.
B) Reserved, Unreserved, and Undesignated.
C) Invested in Capital Assets net of Related Debt, Restricted, and Unrestricted.
D) Educational and General, and Auxiliary Enterprises - CORRECT ANSWER -A
If a donor were to contribute money with instructions that the funds be invested for a period of
time and then released to be used for any purpose, this would be called a(n):
A) Permanent endowment
B) Term endowment
C) Quasi-endowment
D) Unrestricted endowment - CORRECT ANSWER -B
,Which of the following would not be correct with respect to accounting for colleges and
universities under the jurisdiction of the FASB?
A) If both unrestricted and restricted resources are available for a restricted purpose, the FASB
requires that the institution recognize the use of unrestricted resources first
B) Accrual accounting is used. Revenues and expenses are reported at gross amounts and gains
and losses are reported net.
C) Expenses are reported by function, either in the statements or in the notes
D) If an institution decides not to capitalize museum and other inexhaustible collections, note
disclosures are required regarding the collections - CORRECT ANSWER -A
Which of the following would not be correct with respect to accounting for colleges and
universities under the jurisdiction of the FASB?
A) Contributed services should be recognized only when the services create or enhance
nonfinancial assets or require specialized skills, are provided by an individual possessing those
skills, and would typically be purchased if not provided by donation
B) Multiyear pledges are recorded as restricted revenue and receivable for the gross amount of
the pledge when the pledge is made
C) Depreciation is recorded
D) Investments in stock with determinable fair values and all debt securities are reported at
market value - CORRECT ANSWER -B
According to the FASB, plant acquired by colleges and universities with either unrestricted or
restricted resources are recorded as:
A) Restricted
B) Unrestricted
C) Initially as temporarily restricted and reclassified as unrestricted in accordance with the
depreciation schedule
D) Either B or C - CORRECT ANSWER -D
When a private college or university has a foundation, and that foundation receives contributions
specifically directed for the benefit of the college or university,
A) The college or university records no revenue until monies are received from the foundation
, B) At the time of the contribution to the foundation, the college or university records an increase
in net assets and unearned revenue. When the money is received the unearned revenue is reduced
and revenue is recorded.
C) The college or university must recognize its interest in the contribution as an asset and
revenue at the same time as the foundation.
D) None of the above - CORRECT ANSWER -C
13. How should the following revenues be reported by a private college?
− $1,500 state appropriations,
− $5,600 in unrestricted contributions,
− $600 unrestricted investment income on endowment investments,
− $11,600 sales of services by auxiliary enterprises.
Unrestricted Restricted
A) 19,300 0
B) 17,800 1,500
C) 17,200 2,100
D) 5,600 13,700 - CORRECT ANSWER -A
14. The FASB has the authority to set accounting standards for all of the following organizations
except:
A) Public colleges.
B) Private colleges.
C) For profit proprietary schools.
D) Educational foundations established to support a private college or university. - CORRECT
ANSWER -A
15. Which of the following is a required statement for a private college?
A) Statement of Changes in Fund Balance.
B) Statement of Revenues and Expenditures.
