Concept explainers
Introduction:
Loan funds:
Loan funds are established to account for resources that are available for loans primarily to students and possibly to faculty and staff. A separate fund is used because of large amounts of federal and state resources made available to universities for student loans. Loan funds are self-perpetuating, with repayments of principal and the excess interest is collected over costs incurred becoming the base for additional loans. Both principal and earnings must be available for loan purposes.
The resources of loan funds consist of mainly gifts restricted for the loan and unrestricted current fund resources transferred by authorization of the governing board. Although assets are not segregated by restriction, the net assets must reveal their restricted and unrestricted portions.
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Advanced Accounting
- Which of the following is most likely to be true about the financial reporting of a public college or university? Choose the correct.a. It resembles the financial reporting of private colleges and universities.b. It will continue to use its own unique style of financial reporting.c. It resembles the financial reporting made by a proprietary fund within the fund financial statements for a state or local government.d. It will soon be reported using a financial statement format unique to the needs of public colleges and universities that GASB is scheduled to create.arrow_forwardFor the following situations determine the fund or nonfund account best suited to account for it. A fund or nonfund account may be used more than once SITUATIONS: GOB grant proceeds received for construction of a new elementary school building – Capital Projects Fund Municipal electric utility bonds to be repaid from customer charges – Debt Service Fund General obligation bonds issued to finance construction of a new elementary school building – Investment Trust Funds Activities of a central print shop that provides custom printing services to all campus departments – Enterprise Funds Financial resources set aside to service the principal and interest on general obligation debt A special hotel occupancy sales tax that can only be used for city economic development promotional activities Financial resources legally restricted to the extent that only earnings, and not the principal, may be used to benefit the government or its citizenry – Special Revenue Fund…arrow_forwardIndicate with choices (a) through (f ) how the following events are recorded in a private university:a. Credit Contributions—Unrestrictedb. Credit Contributions—Temporarily Restrictedc. Credit Contributions—Permanently Restrictedd. Credit Refundable Depositse. Credit Fund Balancef. No entry 1. Receipt of an unconditional cash contribution._________2. Receipt of cash to be used for a specific purpose._____________3. Receipt of an unconditional promise to give.___________4. Receipt of an unconditional promise to give over a 5-year period._________5. Receipt of investments that are to be used to set up an endowment with earnings available for operations._________6. Receipt of a fixed asset with donor-specified use for an outreach program. 7. Receipt of a conditional promise to give._________ 8. Receipt of a fixed asset with no donor restriction._________ 9. Receipt of free accounting services. _________10. Receipt of time of volunteers who helped with fundraising mailings._________ 11.…arrow_forward
- Which of the following is most likely to be true about the financial reporting of a public college or university? It resembles the financial reporting of private colleges and universities. It will continue to use its own unique style of financial reporting. It resembles the financial reporting made by a proprietary fund within the fund financial statements for a state or local government. It will soon be reported using a financial statement format unique to the needs of public colleges and universities that GASB is scheduled to create.arrow_forwardon are some wong. 19. List and explain the two classes of net assets for private, not-for-profit colleges and universitiesarrow_forwardOver the years, four alternatives have been suggested for constructing the financial statements for public colleges and universities. These alternatives include all of the following except: O Adopt FASB's requirements so that all colleges and universities (public and private) prepare comparable financial statements. O Apply a more traditional model focusing on fund financial statements and the wide variety of funds that such schools often have to maintain. O Create an entirely new set of financial statements designed specifically to meet the unique needs of public colleges and universities. O Adopt the requirements issued by the Private Company Council (PCC) of the FASB. O Adopt the requirements issued by the Private Company Council (PCC) of the FASB. 80 F3 Ơ Q F4 % F5 MacBook Air F6 D F7arrow_forward
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- onation received for specific purpose is: a. Credited to income and expenditure account b. Shown on liabilities side of Balance sheet as Donation Fund c. Debited to income and expenditure account d. Shown as asset side of Balance sheet as Donation Fund Question 14 Question text Which among the following is not an enterprise fund in a school district? a. Athletic stadium that sell tickets to events b. Bookstores c. Public parking spaces d. Cafeteria Question 15 Question text Rule by people is referred to as: a. Republic b. Oligarchy c. Democracy d. Monarchyarrow_forwardName three services that your school (ex. School of Liberal Arts, School of Business, Schoolof Education, etc.) can help you with. Busineas liberal Arts Lendershin andarrow_forwardA private college’s plant funds group includes which of the following subgroups? (1) Renewals and replacement funds (2) Retirement of indebtedness funds (3) Restricted current funds a. 1 and 2 b. 1 and 3 c. 2 and 3 d. None of the abovearrow_forward