Reference no: EM131518429
Questions: Select the best answer.
1. In June 2017, a public university bills and collects $30 million in tuition for the summer semester that runs from June 1 through July 15. In addition, in May and June it bills $200 million for the fall semester that runs from September 1 through December 15. Of this amount it collects only $80 million (expecting to collect the balance prior to September 1). In its statement of revenues and expenses for its year ending June 30, 2017 it should recognize as tuition revenue
a. $20 million
b. $30 million
c. $100 million
d. $110 million
2. In a particular year, a not-for-profit university receives $2 million in dividends and interest on an endowment, the income of which, per donor specification, must be used to provide scholarships to liberal arts students. During the year, it awards (and pays) scholarships of $1.9 million. In accord with a policy established by the university's board of trustees, it adds the $0.1 million balance to the endowment fund to offset the impact of inflation. For that year the university may recognize
a. $1.9 million of unrestricted revenue and $0.1 million of permanently restricted revenue
b. $1.9 million of unrestricted revenue and $0.1 million of temporarily restricted revenue
c. $1.9 million of temporarily restricted revenue and $0.1 of permanently restricted revenue
d. $2.0 million of permanently restricted revenue
3. A not-for-profit university operates its college bookstore as an auxiliary enterprise. During the year the store has revenues of $20 million and expenses of $18 million. In its statement of activities the university should report
a. operating revenues of $2 million
b. operating revenues of $20 million
c. nonoperating revenues of $2 million
d. nonoperating revenues of $20 million
4. In 2017, a government university was awarded a federal reimbursement grant of $9 million to carry out research. Of this, $6 million was intended to cover direct costs and $3 million to cover overhead. In a particular year, the university incurred $2 million in allowable direct costs and received $1.7 million from the federal government. It expected to incur the remaining costs and collect the remaining balance in 2018. For 2017 it should recognize revenues from the grant of
a. $1.7 million
b. $2.0 million
c. $3.0 million
d. $9.0 million
5. A not-for-profit university maintained an endowment of $400,000, the income of which was restricted for an annual conference on international relations. In a particular year, the market value of the endowment increased by $40,000. The university held a conference on international relations at a cost of $43,000. The university should report
a. no revenue and unrestricted expenses of $43,000
b. unrestricted revenues of $40,000 and unrestricted expenses of $43,000
c. temporarily restricted revenues of $40,000, temporarily restricted expenses of $40,000 and unrestricted expenses of $3,000
d. permanently restricted revenues of $40,000 and unrestricted expenses of $43,000
6. Other factors held constant, which of the following colleges is likely to present the least risk that it will default on its bonds
a. one that admits 98 percent of applicants
b. one that draws the majority of its students from overseas
c. one that prepares its students mainly for careers as automotive engineers
d. one which draws its student body almost exclusively from the top 5 percent of high school graduating classes throughout the country
7. Scholarships for which no services are recorded should be recorded as ______________ and scholarships for which services are required should be recorded as ____________
a. revenue deductions; expenses
b. expenses; revenue deductions
c. expenses; expenses
d. revenue deductions; revenue deductions
8. A public university had tuition and fees for the year ended June 30, 2017, in the amount of $18,000,000. Scholarships, for which no services were required, amounted to $1,400,000. Graduate assistantships, for which services were required, amounted to $1,300,000. The amount to be reported by the university as net tuition and fee revenue would be
a. $18,000,000
b. $16,700,000
c. $16,600,000
d. $15,300,000
9. During the year, Griffin University's board of trustees established a $200,000 fund to be retained and invested for scholarship grants. The fund earned $12,000, which had not been distributed by December 31. What amount should Griffin report in a Board designated (quasi) endowment fund's net assets at December 31?
a. $0
b. $12,000
c. $200,000
d. $212,000
10. During the year, LeBlanc College received the following:
a. An unrestricted $70,000 pledge to be paid the following year
b. A $35,000 cash gift restricted for study-abroad scholarships
c. A notice from a recent business school graduate that he has named the college as a beneficiary of $15,000 in his will
11. What amount of contribution revenue should LeBlanc College report in its statement of activities?
a. $35,000
b. $50,000
c. $105,000
d. $120,000