Test: CPA Financial Accounting and Reporting (FAR)

1.

On December 1, Year 1, the Gregory Corporation makes a donation of $100,000 to the Family Services Foundation, a private not-for-profit organization. Gregory requests that Family Services give the money to The Soup Kitchen, another not-for-profit organization, but allows Family Services to give the money to another organization if it seems more appropriate. On December 23, Year 1, Family Services gives the money to The Soup Kitchen. When will each organization recognize the gift as contributed support?

Family Services recognizes contributed support on December 1, and The Soup Kitchen recognizes contributed support on December 23

Family Services never recognizes contributed support, and The Soup Kitchen recognizes contributed support on December 1

Both entities recognize contributed support on December 1

Both entities recognize contributed support on December 23

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