sunnydelite
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Joined: 07 Jul 2010
Location: United States
Online Status: Offline
Posts: 109
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| Posted: 08 Jul 2010 at 20:07 | IP Logged
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Becker Final Review Not for Profit
Nadaf University received $4,000,000 in tuition revenue
for the year ended December 31, 20X1. In addition to the
tuition received, the university offered $500,000 in
scholarships but had to refund $200,000 for cancelled
classes. For the year ended December 31, 20X1, Nadaf
would record gross revenue for tuition of:
1)$3,800,000
2)$4,000,000
3)$4,300,000
4)$4,500,000
The correct answer is 3)$4,300,000
Form Becker's text book Ch9-66, it says that Scholarships
are considered either expenditures or a separately
displayed allowance reducing revenue. I do not understand
why it was recorded as part of the revenue.
Can somebody explain to me? thanks for you help!
By the way, thanks for answering my Government
accounting-reconciliation question.
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Topic: Not for Profit-Government Accounting
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