Which of the following is common to both governments and not-for-profit entities but distinguishes these entities from for-profit entities?

Question

Quizplus · Accepted Answer

All three options are common to both governments and not-for-profit entities and distinguish them from for-profit entities. In for-profit entities, the most significant financial document is typically the income statement, which is used to evaluate profitability. In contrast, governments and not-for-profit entities focus on budgets to allocate resources and measure performance. Additionally, revenue and demand for goods or services are not always directly linked in non-profit entities, as they may receive funding from grants, donations, or taxes instead of sales. Finally, expenses may not be directly linked to revenues in non-profit entities, as expenditures may be dictated by regulations, grants, or other external factors.

Which of the Following Is Common to Both Governments and Not-For-Profit