Which of the following receipts may properly be accounted for as an increase in net assets without donor restrictions by a private college?
A) Student tuition and fees.
B) Gift from an alumnus for a new college of business building.
C) Federal grant for genetic research.
D) Acceptance of assets, the income from which will be paid to the donor.

Question

Quizplus · Accepted Answer

Student tuition and fees represent unrestricted revenue that can be used by the private college to support its operations without any conditions or restrictions.

Answer: C
 Federal grants, especially those that are not earmarked or restricted, also represent unrestricted revenue and can be used to support the college's operations.

Answer: D
 The acceptance of assets, the income from which will be paid to the donor, represents a liability since the college cannot use the assets or their income until the donor's conditions have been met.

Therefore, choices A and C are properly accounted for as an increase in net assets without donor restrictions, while choice D is not. Choice B represents a restricted donation since it was made for a specific purpose.

Which of the Following Receipts May Properly Be Accounted for as an Increase