Question

1. A public university had tuition and fees for the year ended June 30, 2012, in the amount of $27,000,000. Scholarships, for which no services were required, amounted to $2,100,000. Graduate assistantships, for which services were required, amounted to $1,950,000. The amount to be reported by the university as net tuition and fee revenue would be

a) $27,000,000

b) $25,050,000

c) $24,900,000 ,answer

d) $22,950,000

please explain details and how to get it and why.

2. During the year, Dakota University’s board of trustees established a $500,000 fund to be retained and invested for scholarship grants. The fund earned $30,000, which had not been distributed by December 31. What amount should Dakota report in a board-designated (quasi) endowment fund’s net position at December 31?

a) $0

b) $30,000

c) $500,000

d) $530,000 ,answer

please explain details and how to get it and why.

3. The following transactions were among those reported by Corfe City's electric utility enterprise fund for Year 1:

Capital contributed by subdividers $ 900,000

Cash received from customer households 2,700,000

Proceeds from sale of revenue bonds 4,500,000

In the electric utility enterprise fund's statement of cash flows for the year ended December 31, Year 1, what amount should be reported as cash flows from capital and related financing activities?

a. $4,500,000

b. $5,400,000, answer

c. $7,200,000

d. $8,100,000

please explain details and how to get it and why.

Answer 1

Ans:

1. The correct option for the answer is option C i.e. 24,900,000

Amount to be reported by the University As net tuition and fee revenue would be:

=27,00,000-2,100,000

= 24,900,000

2. The correct option for the answer is option D i.e. $530,000

Dakota Should report in a board-designated (quasi) endowment fund’s net position at December 31:

= $500,000+ $30,000

= $530,000

As fund to be retained and invested for scholarship is $500,000 and as fund earned and not been distributed till Dec 31, therefore it should be added to endowment fund net position

3. The Correct option for the answer is option B i.e. $5,400,000

Cash received from Customer household is a part of operating activities and other two i.e.

Capital contributed by subdividers $ 900,000 and Proceeds from sale of revenue bonds 4,500,000

Therefore cash flow from financing activities will be $4,500,000+900,000

=$ 5,400,000