Accounting For Governmental & Not-for-profit Entities Quiz

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| By JIJohnson
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Quizzes Created: 4 | Total Attempts: 7,016
Questions: 10 | Attempts: 1,048

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Accounting For Governmental & Not-for-profit Entities Quiz - Quiz

Are you ready for this "Accounting for Governmental & Not-for-Profit Entities" quiz that we have brought here for you? Financial Accounting means to analyze, summarize, and record financial transactions as well as to show an accurate picture of the financial affairs of the company. This quiz has been developed to test your knowledge of Financial Accounting Concepts for Non-Governmental and Not-For-Profit Entities. So, let's try out the quiz, and we will see how well you are able to score. All the best to you with this quiz, and have fun!


Questions and Answers
  • 1. 

    Like other governmental funds, proprietary funds have no emphasis on income measurement.

    • A.

      True

    • B.

      False

    Correct Answer
    B. False
    Explanation
    Proprietary funds are the most like commercial business in the governmental environment. Consequently, net income is a measure of proper management and financial health.

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  • 2. 

    Governmental entities are required to use an internal service fund for self-insurance activities.

    • A.

      True

    • B.

      False

    Correct Answer
    B. False
    Explanation
    Many do use an internal service fund for self-insurance, but there is no GASB or other authoritative requirement.

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  • 3. 

    Not-for-profit organizations frequently do not value their beneficiary customers because they exist in a monopolistic situation.

    • A.

      True

    • B.

      False

    Correct Answer
    A. True
  • 4. 

    One purpose of an internal service fund is to pool the government's resources for a more efficient operation in carrying out the fund's purpose.

    • A.

      True

    • B.

      False

    Correct Answer
    A. True
    Explanation
    An internal service fund is a type of fund that allows a government entity to pool its resources and provide services to other departments or agencies within the same government. By consolidating resources, the government can achieve economies of scale and operate more efficiently. This can result in cost savings, improved service delivery, and better coordination among different departments. Therefore, the statement that one purpose of an internal service fund is to pool the government's resources for a more efficient operation is true.

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  • 5. 

    Enterprise funds are used for "business-type" activities, and internal service funds are used predominantly for "governmental-type" activities.

    • A.

      True

    • B.

      False

    Correct Answer
    A. True
    Explanation
    Enterprise funds are a type of accounting fund that is used for activities that are similar to those of a business. These funds are typically used for revenue-generating activities that are intended to cover their own costs. On the other hand, internal service funds are used for activities that primarily serve other departments or agencies within the government. These funds are used to provide services such as information technology or fleet management to other government entities. Therefore, the statement that enterprise funds are used for "business-type" activities and internal service funds are used predominantly for "governmental-type" activities is true.

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  • 6. 

    Comparing non-profit organizations to for-profit organizations, which of the following statements is not correct?

    • A.

      With not-for- profit 'products', there is typically a weaker unique selling proposition

    • B.

      In the not-for-profit environment, it may be necessary to develop a campaign to drive behaviour in all targets rather than a specific audience

    • C.

      The mission statement of non-profit organizations usually revolve around being the best in a particular sector.

    • D.

      Price has different connotations in not-for-profit situations

    Correct Answer
    C. The mission statement of non-profit organizations usually revolve around being the best in a particular sector.
    Explanation
    The statement that is not correct is that the mission statement of not-for-profit organizations usually revolve around being the best in a particular sector. For commercial organizations, the mission statement usually focuses on being 'best in market' and consequently achieving high levels of profit. In the not-for-profit sector, mission statements focus on causes. The raison d'être of a not-for profit is often to solve a particular societal problem

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  • 7. 

    Which of the following is not a key characteristic of not-for-profit organizations?

    • A.

      Multiple stakeholders

    • B.

      Revenue orientation

    • C.

      Multiple objectives.

    • D.

      Transparency.

    Correct Answer
    B. Revenue orientation
    Explanation
    The key characteristics which impact on marketing include: the presence of multiple stakeholders, transparency in the organization's mission and finances, the presence of multiple objectives in business and social terms, a different orientation compared with commercial organizations and, finally, different customer perceptions.

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  • 8. 

    Which of the following is not an example of non-profit marketing?

    • A.

       Political marketing.

    • B.

      Cause marketing.

    • C.

      Event marketing.

    • D.

      Public-sector marketing.

    Correct Answer
    C. Event marketing.
    Explanation
    Event marketing is not an example of not-for-profit marketing. We can classify four main types of not-for-profit organizations, including 1) charities, 2) the newly emerging social enterprise sector, 3) the public sector and 4) political parties and campaigning organizations.

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  • 9. 

    A Fairtrade scheme is an example of a _________.

    • A.

      Business enterprise.

    • B.

      Public sector.

    • C.

      Campaigning organization

    • D.

      Social enterprise.

    Correct Answer
    D. Social enterprise.
    Explanation
    In the UK, the government considers a social enterprise to be one that: 'is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximize profit for shareholders and owners' (BIS, 2011: 2). Social enterprises blend social objectives with commercial reality. There is a drive to make a profit, but any surplus is reinvested into the enterprise and not redistributed as a reward to owners.

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  • 10. 

    Which of the following is not one of the reasons why non-profit organizations frequently do not value their beneficiary customers?

    • A.

      They have extensive research programme to identify customers' needs.

    • B.

      They exist in a monopolistic situation.

    • C.

      The demand far outstrips supply

    • D.

      A lack of market segmentation activity exists

    Correct Answer
    A. They have extensive research programme to identify customers' needs.

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  • Current Version
  • Sep 08, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Feb 27, 2008
    Quiz Created by
    JIJohnson
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