NINJA CPA Review

Test Your Might: FAR – Not-for-Profit Accounting

CPA Exam Section: Financial Accounting & Reporting

CPA Review Topic: Not-for-Profit Accounting

Question: Carlson Hospital, a nonprofit hospital affiliated with Carlson College, had the following cash receipts for the year ended December 31, 2012:

Collections of health care receivables: $850,000
Contribution from donor for term endowment: $150,000
Tuition from nursing school: $50,000
Dividends permanent endowment investment: $75,000

The dividends received are restricted by the donor for hospital building improvements. No improvements were made during 2012.

On the hospital’s statement of cash flows for the year ended December 31, 2012, what amount of these cash receipts would be included in the amount reported for net cash provided (used) by operating activities?

a. $1,050,000
b. $900,000
c. $975,000
d. $850,000

Source: Wiley Test Bank

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