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ABC Not-for-Profit XYZ Not-for-Profit $ 72,800 184, 100 22,600 169,200 448, 700 $ 179,100 69, 300 105,000 62,000 415, 400 535,000 2,700,000 2, 366,500 5,

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ABC Not-for-Profit XYZ Not-for-Profit $ 72,800 184, 100 22,600 169,200 448, 700 $ 179,100 69, 300 105,000 62,000 415, 400 535,000 2,700,000 2, 366,500 5, 601,500 $6,050, 200 2,038,000 2,038,000 $2,453,400 STATEMENT OF NET ASSETS Current assets Cash Short-term investments Supplies inventories Receivables Total current assets Noncurrent assets Pledges receivable Long-term investments Land, buildings, and equipment (net) Total noncurrent assets Total assets Current liabilities Accounts payable Total current liabilities Noncurrent liabilities Notes payable Total noncurrent liabilities Total liabilities Net Assets Unrestricted Temporarily restricted Permanently restricted Total net assets Total liabilities and net assets $ $ 23,000 23,000 123,600 123,600 178,500 178,500 201,500 123,600 5,695,000 153,700 1, 403,800 926,000 5,848, 700 $6,050, 200 2,329,800 $2,453, 400 Presented below are financial statements (except cash flows) for two not-for-profit organizations. Neither organization has any permanently restricted net assets. ABC Not-for-Profit Temporarily Unrestricted Restricted XYZ Not-for-Profit Temporarily Unrestricted Restricted $5,665,000 3,369,000 $ 745,400 95, 400 $2,192,000 3,117,500 $ 813,500 17,700 (367,200) 455, 200 9,506,900 (455, 200) 385,600 367,200 5,676,700 446,300 Statement of Activities Revenues Program service revenue Contribution revenues Grant revenue Net gains on endowment investments Net assets released from restriction Satisfaction of program restrictions Total revenues Expenses Education program expenses Research program expense Total program service expenses Fund-raising Administration Total supporting service expenses Total expenses Increase in net assets Net assets January 1 Net assets December 31 5,691,500 1,336,000 7,027,500 466,800 720,000 1,186, 800 8, 214, 300 1, 292,600 4,288,000 $5,580, 600 1,528,700 2, 212,100 3,740, 800 363,000 1,234,000 1,597,000 5,337,800 338, 900 823,500 $1,162,400 385,600 739, 600 $1,125,200 446,300 220,400 $ 666, 700 Required: a. Calculate the following ratios (Assume 365 days): Program expense. Fundraising efficiency. Working capital. b. For each ratio, which of the two organizations has the stronger ratio. (Do not round intermediate calculations. Round "Program expense" answers to 1 decimal place and "Fund-raising efficiency" answers to 3 decimal places and "Working capital" answers to nearest whole number.) XYZ ABC 85.61% 70.11% RATIO Program expense Fund-raising efficiency Working capital Stronger Ratio ABC Not-for-Profit ABC Not-for-Profit XYZ Not-for-Profit days days ABC Not-for-Profit XYZ Not-for-Profit $ 72,800 184, 100 22,600 169,200 448, 700 $ 179,100 69, 300 105,000 62,000 415, 400 535,000 2,700,000 2, 366,500 5, 601,500 $6,050, 200 2,038,000 2,038,000 $2,453,400 STATEMENT OF NET ASSETS Current assets Cash Short-term investments Supplies inventories Receivables Total current assets Noncurrent assets Pledges receivable Long-term investments Land, buildings, and equipment (net) Total noncurrent assets Total assets Current liabilities Accounts payable Total current liabilities Noncurrent liabilities Notes payable Total noncurrent liabilities Total liabilities Net Assets Unrestricted Temporarily restricted Permanently restricted Total net assets Total liabilities and net assets $ $ 23,000 23,000 123,600 123,600 178,500 178,500 201,500 123,600 5,695,000 153,700 1, 403,800 926,000 5,848, 700 $6,050, 200 2,329,800 $2,453, 400 Presented below are financial statements (except cash flows) for two not-for-profit organizations. Neither organization has any permanently restricted net assets. ABC Not-for-Profit Temporarily Unrestricted Restricted XYZ Not-for-Profit Temporarily Unrestricted Restricted $5,665,000 3,369,000 $ 745,400 95, 400 $2,192,000 3,117,500 $ 813,500 17,700 (367,200) 455, 200 9,506,900 (455, 200) 385,600 367,200 5,676,700 446,300 Statement of Activities Revenues Program service revenue Contribution revenues Grant revenue Net gains on endowment investments Net assets released from restriction Satisfaction of program restrictions Total revenues Expenses Education program expenses Research program expense Total program service expenses Fund-raising Administration Total supporting service expenses Total expenses Increase in net assets Net assets January 1 Net assets December 31 5,691,500 1,336,000 7,027,500 466,800 720,000 1,186, 800 8, 214, 300 1, 292,600 4,288,000 $5,580, 600 1,528,700 2, 212,100 3,740, 800 363,000 1,234,000 1,597,000 5,337,800 338, 900 823,500 $1,162,400 385,600 739, 600 $1,125,200 446,300 220,400 $ 666, 700 Required: a. Calculate the following ratios (Assume 365 days): Program expense. Fundraising efficiency. Working capital. b. For each ratio, which of the two organizations has the stronger ratio. (Do not round intermediate calculations. Round "Program expense" answers to 1 decimal place and "Fund-raising efficiency" answers to 3 decimal places and "Working capital" answers to nearest whole number.) XYZ ABC 85.61% 70.11% RATIO Program expense Fund-raising efficiency Working capital Stronger Ratio ABC Not-for-Profit ABC Not-for-Profit XYZ Not-for-Profit days days

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