Which of the following is a legitimate reason for a not-for-profit organization to have a surplus (increase in net assets)?

Question

Quizplus · Accepted Answer

A not-for-profit organization may have a surplus to establish working capital for future projects or to retire debt. These actions ultimately benefit the organization's long-term financial stability and ability to fulfill its mission. However, having a surplus just for the sake of accumulating funds is not an acceptable practice for not-for-profit organizations.

Which of the Following Is a Legitimate Reason for a Not-For-Profit