The Atkins Museum recently hired a new controller. He was considered well qualified for the position given his experience with managerial accounting and his strong communication skills. The new controller sent each member of the Board of Trustees’ Finance Committee a set of the financial statements for their review one week before the monthly meeting. The set included the following statement of activities.

Other information:

The management and general expenses are first allocated to the programs to which they directly relate; for example, the executive director’s salary is allocated to the Public Exhibit Program according to the percentage of time spent working on the program. Remaining unallocated management and general expenses are allocated to the programs as indirect costs based on the relative amount of salaries and wages to total salaries and wages for the program.

Required

As a member of The Atkins Museum’s Board of Directors Finance Committee, review this statement and answer the following questions:

a. Is the statement in proper form according to FASB standards?

b. What questions do you have for the controller?

c. The Atkins Museum would like to open an Impressionists exhibit. If its operating expenses are expected to be similar to those of the Abstract Exhibit, how much should the organization solicit in contributions or grants to cover the full cost of the program?

d. If you were a potential contributor to the Atkins Museum, do you think you have enough information from this statement on which to base your decision to donate?

Transcribed Image Text:

Revenues Contributions Charges for services Interest income Total revenues Expenses: Salaries and wages Occupancy costs Supplies Equipment Travel and development Depreciation Interest THE ATKINS MUSEUM Statement of Activities For the Year Ended June 30, 2023 (in hundreds of dollars) Total variable expenses Allocated management and general expenses Total costs Excess of revenues over expenses Abstract Mgmt. & Public Exhibits Exhibit General $ 61,400 478,800 0 540,200 $50,000 $ 0 0 2,500 50,000 2,500 381,900 24,700 44,200 38,100 12,000 14,900 7.100 2,300 8.300 5,000 6,500 2,800 6.900 12,000 6,300 3,700 446,900 40,500 90,800 85,300 5,500 (90,800) 532,200 46,000 0 $ 8,000 $4,000 $2,500 0 0 $111,400 0 478,800 2,500 592,700 0 1,500 0 Total 450,800 65,000 17,700 11,500 9,700 19,800 3,700 578,200 0 578,200 $ 14,500