Podcast
Questions and Answers
Contributions to non-profit organizations are measured at fair value at the date of contribution. (True or False)
Contributions to non-profit organizations are measured at fair value at the date of contribution. (True or False)
True
Unrestricted support increases temporarily restricted net assets. (True or False)
Unrestricted support increases temporarily restricted net assets. (True or False)
False
Restricted support increases permanently restricted net assets. (True or False)
Restricted support increases permanently restricted net assets. (True or False)
True
Equity securities with fair value of P500,000 to be held indefinitely is an example of unrestricted support. (True or False)
Equity securities with fair value of P500,000 to be held indefinitely is an example of unrestricted support. (True or False)
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Cash of P200,000 and land with a fair value of P1,000,000 to be used at the entity’s discretion is an example of unrestricted support. (True or False)
Cash of P200,000 and land with a fair value of P1,000,000 to be used at the entity’s discretion is an example of unrestricted support. (True or False)
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When does an unconditional promise to give cash or non-cash assets in a future period get recognized?
When does an unconditional promise to give cash or non-cash assets in a future period get recognized?
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If the promised contribution becomes doubtful of collection, what is recognized?
If the promised contribution becomes doubtful of collection, what is recognized?
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Conditional promises to give are recognized only when what condition is met?
Conditional promises to give are recognized only when what condition is met?
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When is a conditional promise to give considered unconditional?
When is a conditional promise to give considered unconditional?
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Under what circumstances are contributions of services recognized?
Under what circumstances are contributions of services recognized?
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Study Notes
Non-Profit Accounting Concepts
- Contributions to non-profit organizations are recorded at fair value on the date of contribution.
- Unrestricted support does not increase temporarily restricted net assets.
- Restricted support enhances permanently restricted net assets.
- Equity securities valued at P500,000, held indefinitely, qualify as unrestricted support.
- Cash of P200,000 and land valued at P1,000,000, available at the organization's discretion, exemplify unrestricted support.
Recognition of Promises to Give
- An unconditional promise to donate cash or non-cash assets in the future is recognized at the promise date.
- If a promised contribution becomes doubtful, a recognition of loss may occur, reflecting reduced asset collection expectations.
- Conditional promises to give are recognized only when all specified conditions are met.
- A conditional promise transitions to unconditional once the defined conditions have been satisfied.
- Contributions of services may be recognized if they create a measurable economic benefit and meet specific criteria outlined by the organization.
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Description
Test your understanding of recognition and measurement of cash and other non-cash assets in non-profit organizations. Explore how contributions are measured, reported, and categorized as unrestricted or restricted support revenue.
