1) A private NFP's statement of cash flows presents cash from operating activities using the indirect method. In the reconciliation of the change in net assets to cash from operating activities, which item isadded?

A.Donations of endowment cash

B.Reduction in contributions receivable

C.Unrealized gains on investments

D.Increase in loans payable

2) At the beginning of the current year, a donor gave the Fresno Rehabilitation Center, a private NFP organization, $100,000 in cash, with the provision that the cash be invested in income-producing securities. The center is to pay the donor all income generated on the investments for his remaining life. Income is defined as cash income and unrealized investment gains or losses. Upon his death, remaining resources become available to the center with no restrictions as to use. The center invested the $100,000 in securities earning cash dividend and interest income of $3,500 in the current year. The securities have a fair value of $102,000 at the end of the year. The donor's life expectancy is 10 years, and the annual discount rate is 5%. The present value of $1/year for 10 years, discounted at 5%, is 7.7217.

The annuity payable, reported on the statement of net position for the current year-end, is

A.$-0-

B.$ 27,026

C.$100,000

D.$ 72,974

3) A contractor contributes services valued at $40,000 to build a new building for a private NFP organization. The net effect of this contribution in the organization's statement of activities is:

A.Not reported in the statement of activities.

B.$40,000 increase in net assets with donor restrictions.

C.Increase in expenses and increase in contributions of $40,000; no net effect on net assets.

D.$40,000 increase in net assets without donor restrictions.