If a not-for-profit organization that usually has had annual revenues well below $500,000, subsequently has (for two years or more) revenues significantly higher than $500,000, how must it report its Capital Assets?

Question

Quizplus · Accepted Answer

Once a not-for-profit organization has significantly higher revenues than $500,000 for two years or more, it must follow Generally Accepted Accounting Principles (GAAP) for reporting capital assets. This includes capitalizing and amortizing these assets on a prospective basis, as opposed to continuing with the same policy or retroactively capitalizing and amortizing. Therefore, the correct choice is C.

If a Not-For-Profit Organization That Usually Has Had Annual Revenues