CAF-1 · Chapter 13 · Question 11 of 15
When an NPO uses fund accounting, how is depreciation expense treated?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) It is charged to the fund or funds that provide the most meaningful presentation.
Explanation
When a fund accounting basis is used, the choice of the fund to which depreciation is charged is based on providing the most meaningful presentation of the NPO's activities.
More Accounting for NPOs MCQs
- Q13Which of the following is typically NOT a source of income for a Non-Profit Organization?
- Q14If an NPO has a deficit for the year, how is it presented?
- Q15What is the formula used in a subscription T-account to find the subscription income for the year?
- Q1What is the primary difference between a Non-Profit Organization (NPO) and a commercial entity?
- Q2In the financial statements of an NPO, what is the equivalent of 'Equity' or 'Retained Earnings'?