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Test: CPA Financial Accounting and Reporting (FAR)
1. | The New York Museum of Art is a private, not-for-profit organization. It receives a gift of a painting worth $1 million on the date of the gift, which qualifies as a work of art or historical treasure. How will this donation be recorded by the museum? |
The museum must record an increase in restricted net assets of $1 million
The museum must record an asset of $1 million
The art work is not recorded in the financial statements
The museum can report an asset of $1 million or have no reporting at all
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