Home / nonprofit / accounting for governmental and nonprofit entities test bank ACCOUNTING FOR GOVERNMENTAL AND NONPROFIT ENTITIES TEST BANK 07/08/2021 Solution Manual, Test Bank, ebook For Accounting for Government and also Nonprofit Organization...View moreStudents additionally viewedTest Bank Solutions For International Accounting fifth Edition By DoupnikManagerial Accounting 17th Edition By Ray Garrison; Systems Manual, Test Bank, eBookFinancial Accounting for Undergraduates 4e, fourth Edition by Wallace Solutions and Test BankIntermediate Accounting: Volume 1, 2nd Edition 2e by hanlon Solutions and also Test BankManagerial Accounting 8th Edition 8e by Hartgraves Test Bank and also SolutionsManagerial Accounting for Undergraduates 2e, 2nd Edition by Christensen Test Bank and also SolutionsOther connected documentsAE 2012 Midterm Quiz for ClassTest Bank, Solutions For Focus on Personal Finance 7th Edition 7e By Jack KapoorReactive Attachment DisorderModern Accounting fourth Edition by Hopkins Solutions and also Test BankSolutions and Test Bank For Personal Finance Tax Upday 13th Edition 13e By E. Thomas Garmane AMB303 A3 Indevelopment SEM 1 2021Preview textFor More Info : tbdotsmgmail.comChapter 1Governmental and NonprofitAccountingEnvironment and CharacteristicsLearning Objectives – Coverage by QuestionTrue / False Multiple Choice Exercises ProblemsLO1 – Understand thedistinction betweengovernpsychological and nonprofitentities and commercialbusinesses.You watching: Accounting for governmental and nonprofit entities test bank1-7 1-10 2LO2 – Understandmissions and distinctivefeatures of financialreporting for governmentsand also nonprofit entities.8-15 10-16 1-LO3 – Understand theresources of generallyembraced accountingvalues for governmentsand also nonprofit entities.16-19 17-21 2-Chapter 1: Governmental and also Nonprofit Accounting Environmentand also CharacteristicsTrue / FalseTopic: Governpsychological and Nonprofit OrganizationsLO: 11. An entity is most likely to be a governmental entity if a managing majority of its governing body is appointed by governpsychological officials.Answer: TrueRationale: Entities developed by federal governments by statuteor under nonprofit legislations are governmental if theirpolicemans are popularly elected, or a managing majority of their governing body is appointed orapverified by governpsychological officials.Topic: Governpsychological and Nonprofit OrganizationsLO: 12. Characteristics that differentiate nonprofits from company enterprises incorporate nonrevenues receiving significant contributions from resource suppliers without an expectation of receive an indistinguishable rerotate and the absence of a profit motive.Answer: TrueRationale: Businesses rarely get charitable contributions and also exist to make earnings to enhancethe riches of their owners. Nonrevenues get significant charitable contribution and also are not inservice to make a profit.Topic: Operating EnvironmentLO: 13. A function of a government is to carry out solutions to its constituents.Answer : TrueRationale : Company enterprises exist to improve the riches of its owners, but a government exist toadminister services to its constituents.Topic: Operating EnvironmentLO: 14. A objective of a nonprofit is to provide solutions to its constituents.Answer : TrueRationale : Firm enterprises exist to enhance the riches of its owners, however a nonprofit exists toadminister solutions to its constituents.Topic: Operating EnvironmentLO: 15. Governments get the majority of of their profits through exadjust transactions.Answer : FalseRationale : Governments obtain a lot of of their earnings from taxes.1-2 Accounting for Governpsychological and also Nonprofit Organizations, first EditionTopic: Accounting and Financial Reporting CharacteristicsLO: 211. All federal governments prepare money financial statements for external financial reporting purposes.Answer : FalseRationale : State and also neighborhood governments prepare money financial statements, however fundsare not used inthe federal financial statements.Topic: Accounting and also Financial Reporting CharacteristicsLO: 212. The federal government and also state and regional federal governments use the modified accrual basis of bookkeeping.Answer : FalseRationale : State and neighborhood governments use the modified accrual basis of audit to account fortheir basic government functions and the accrual basis of audit to account for business-typetasks and also for their government-wide financial statements. The federal federal government, yet, onlysupplies the accrual basis of accountancy for financial reporting objectives.Topic: Accounting and also Financial Reporting CharacteristicsLO: 213. The FASAB develops financial reporting standards for all federal governments.Answer : FalseRationale : The Federal Accounting Standards Advisory Board (FASAB) sets financial reportingrequirements for the federal federal government, however the Governmental Accounting Standards Board (GASB)sets financial reporting standards for state and also local federal governments.Topic: Accounting and also Financial Reporting CharacteristicsLO: 214. The GASB develops financial reporting criteria for state and local federal governments and also nonprofit entities.See more: Nonprofit Management Case Studies Archives, Nonprofit Management ArchivesAnswer : FalseRationale : The GASB creates financial reporting criteria for state and also neighborhood federal governments, butthe FASB creates financial reporting requirements for nonprofit entities.Topic: Accounting and Financial Reporting CharacteristicsLO: 215. In their goals of financial reporting, both the FASAB and also GASB state that financial reporting need to aid in the government’s duty to be publicly accountable.Answer : TrueRationale : Public accountcapacity is a vital objective in both the FASAB and also GASB’s ConceptsStatements.Topic: Accounting Principles and StandardsLO: 316. The FASB develops financial reporting standards for all nongovernmental entities, including nonprofit colleges and also universities and also wellness treatment carriers.Answer: TrueRationale: The FASB creates financial reporting criteria for all nongovernmental entities,including nonearnings, such as nonprofit colleges and also colleges and also nonprofit health and wellness care providers.1-4 Accounting for Governpsychological and also Nonprofit Organizations, first EditionFor More Info : tbdotsmgmail.comTopic: Accounting Principles and StandardsLO: 317. The financial reporting requirements establiburned by the FASAB, GASB, and FASB are considered to be primarily welcomed audit values by virtue of the authority accorded them by the General Accountability Office.Answer: FalseRationale: The Amerihave the right to Institute of Certified Public Accountants’ Code of Professional Conduct—notthe General Accountability Office—offers the authoritative GAAP standing for financial reportingrequirements promulgated by the FASAB, GASB, and also FASB.Topic: GAAP HierarchyLO:18. GASB standards identify just two categories of GAAP for state and regional federal governments. The many authoritative resource of GAAP is GASB Statements.Answer: TrueRationale: GASB criteria recognize only two categories of GAAP for state and regional governments.Category A is the many authoritative resource of GAAP and is comprised of GASB Statements andInterpretations. Group B is likewise authoritative and also is comprised of GASB Technical Bulletins, GASBImplementation Guides, and AICPA literature cleared by the GASB.Topic: GAAP HierarchyLO:19. The FASB Codification is the single resource of authoritative GAAP for nonprofit organizations.Answer: TrueRationale: The FASB Codification is the single resource of authoritative GAAP for nonprofitinstitutions. Any accountancy literature—outside the FASB Codification—is nonauthoritative.For More Info : tbdotsmgmail.comTopic: Operating EnvironmentLO: 1 4. Many of the earnings derived by most federal governments come from: a. Taxes b. Sales of items or solutions c. Borrowing d. All of the above.Answer : ARationale : Governments achieve many of their revenues from assorted kinds of taxes. Of course,borrowing does not cause revenue. Although a couple of governments attain a large percentage of theirprofits from the sale of goods or services—such as a government-owned utilities or hospitals—the largest source of revenues for claims, cities, counties, and most various other governments is taxes.Topic: Operating EnvironmentLO: 1 5. Which of the complying with is a major resource of sources for many kind of nonrevenues, yet not for businesses or governments? a. Donor contributions b. Taxes c. Sales of products to consumers d. Sale of stockAnswer : ARationale : Donor contributions are significant resource of profits for many kind of nonprofits. Somegovernments obtain donations, but generally, not to the extent of nonprofits. A government’ssignificant resource of revenue primarily is miscellaneous types of taxes. Businesses obtain a lot of of theirrevenue from the sale of goods or solutions.Topic: Operating EnvironmentLO: 1 6. A nonprofit company percreates all of the complying with tasks other than a. Charging a fee for solutions offered b. Paying dividends to shareholders c. Purchasing long-lived (capital) assets d. Paying overtime to employeesAnswer : BRationale : Nonprofit institutions, unprefer service enterprises, lack ownership interests.Therefore, they perform not engage in ownership-kind transactions, such as issuing stock and payingdividends.Topic: Governpsychological and Nonprofit OrganizationsLO: 1 7. The GASB develops financial reporting criteria for state and neighborhood governpsychological entities. An entity developed by a federal government possessing one or more of the adhering to characteristics need to follow GASB standards: a. The power to enact and also levy a tax. b. The power to straight issue debt, for which its interemainder is exempt from federal taxes. c. The potential that another federal government can unilaterally disresolve the entity and assume their assets and also liabilities. d. Any of the over. e. Only a and also b.Answer : DRationale : The GASB Codification, Section 1000, paragraph .801 defines that any kind of of the aboveattributes indicate that an organization produced by a federal government must be taken into consideration afederal government for financial reporting purposes.Topic: Governpsychological and also Nonprofit OrganizationsLO: 1 8. An activity that is unique to federal governments is a. Budgeting b. Cash management c. Levying taxes d. AdvertisingAnswer : CRationale : Many organizations interact in budgeting, cash monitoring, and proclaiming.Governments have the distinctive capability to levy taxes.Topic: Operating EnvironmentLO: 1 9. Nonprofit organizations acquire their earnings mainly from a. Issuance of bonds b. Contributions from donors c. Taxes on personal property d. Taxes on genuine propertyAnswer : BRationale : Donor contributions are significant source of earnings for many type of nonearnings. Theissuance of bonds outcomes in a liability. Nonprofits execute not levy taxes on individual or real residential property.Topic: Accounting and also Financial Reporting CharacteristicsLO: 1, 2 10. External governmental financial reporting focuses on which of the following? a. Calculating profit or loss b. Protecting investors from fraud c. Demonstrating accountability d. Reporting to managementAnswer : CRationale : Public accountcapacity is a crucial objective in both the FASAB and GASB’s ConceptStatements1-8 Accounting for Governpsychological and Nonprofit Organizations, 1st EditionTopic: Users and also Uses of Accounting InformationLO: 2 15. The major outside users of governmental financial reports include: a. Taxpayers. b. Stockholders. c. Bond-rating agencies. d. Both a and b. e. Both a and c.Answer : ERationale : The significant outside users of governmental financial reports are sources suppliers,oversight bodies, and also service recipients. Reresource companies incorporate taxpayers, grant-providingestablishments, investors, and also bond-rating agencies.Topic: Accounting and Financial Reporting CharacteristicsLO: 2 16. To what extent execute organizations that report based upon money audit also report on the entity as a whole? a. Organizations that are required toreport based upon money bookkeeping are not compelled to report on the entity overall b. Organizations that pick to report on the entity all at once are not permitted to prepare reports based upon fund bookkeeping for inner functions c. Organizations that are compelled to report based on fund accounting are required to also report on the entity all at once d. Organizations that are compelled to report based money bookkeeping have actually the choice toalso report on the entity as a wholeAnswer : CRationale :State and regional government are required to report based on fund accounting and alsoare required to report on the entity all at once. No various other company is required to report bymoney. Nonprofits must report on the entity all at once yet may also might use fund-based reportingalthough they are not compelled to perform so.Topic: Accounting Principles and StandardsLO: 3 17. For which kinds of organizations is the FASB responsible for creating accounting and financial reporting standards? a. Business enterprises and also nonprofit establishments, consisting of nonprofit colleges, colleges and also health and wellness treatment suppliers b. Business enterprises; nonprofit organizations; and all colleges, universities and also health care carriers, whether organized as nonprofit or governpsychological entities c. Company enterprises only d. All entities, other than for those under the jurisdiction of the Amerideserve to Institute of CPAsAnswer : ARationale :The AICPA’s’ Code of Professional Conduct says that the FASB develops financialreporting criteria for company enterprises and nonprofit organizations.