Donated services should be recorded as contributions by a nongovernmental,not-for-profit organization if material,and if they meet the criteria set out in SFAS No.116.

Question

Quizplus · Accepted Answer

Donated services are recorded as contributions and as expenses only when the service is one that meets the SFAS No. 116 criteria discussed in Chapter 14 under the caption "Donated Materials and Services." Services must create or enhance nonfinancial assets (such as a carpenter constructing a building), or be provided by individuals possessing specialized skills that typically would need to be purchased if not provided by donations (e.g., accountants or lawyers).

Donated Services Should Be Recorded as Contributions by a Nongovernmental,not-For-Profit