1. Which of the following statements is correct?

1. On the statement of financial position of a nonprofit entity, investments in equity and debt securities are reported at their fair value.
2. On the statement of activities for a nonprofit entity, expenses are reported as decreases in both net assets without donor restrictions and net assets with donor restrictions.
3. A and B.
4. Neither A nor B.

2. Which of the following statements is correct?

1. The Internal Revenue Service allows income tax deductions for contributions made to all 501 (c) type nonprofit entities.
2. On the statement of cash flows for a nonprofit entity, the acquisition of capital assets is reported as a capital and related financing activity.
3. A and B.
4. Neither A nor B.

3. Which of the following statements is correct?

1. All nonprofit entities are required to report a statement of functional expenses.
2. Assets that are restricted by creditors in accordance with debt covenants are included in the amount reported for net assets without donor restrictions on the statement of financial position.
3. A and B.

Neither A nor B