_____ Under FAS 117, how would the expiration of a prior-year donor restriction as to purpose be reflected in the current-year statement of activities?
A) Recognition of an expense.
B) Recognition of a revenue.
C) Recognition of both an expense and an offsetting revenue amount.
D) A separate line item reclassification between the temporarily restricted category and the unrestricted category.
E) None of the above.

Question

_____	Under FAS 117, how would the expiration of a prior-year donor restriction as to purpose be reflected in the current-year statement of activities?
A) Recognition of an expense.
B) Recognition of a revenue.
C) Recognition of both an expense and an offsetting revenue amount.
D) A separate line item reclassification between the temporarily restricted category and the unrestricted category.
E) None of the above.

Quizplus · Accepted Answer

Under FAS 117 (now known as ASC 958 due to the codification of FASB standards), the expiration of a prior-year donor restriction is reflected as a reclassification from temporarily restricted net assets to unrestricted net assets. This is shown as a separate line item in the statement of activities, indicating the funds are now available for general use.

_____ Under FAS 117, How Would the Expiration of a Prior-Year