Chapter 1, Problem 19.10EP

The primary reason that not-for-profit (NFP) organizations should report expenses incurred for program purposes separately from those for supporting services such as management and general and fund-raising is that

1. a.      GASB standards require it.
2. b.      Program managers need information about the cost of activities for which they are responsible.
3. c.       Top managers need to know how much they are spending for nonprogrammatic management and general support.
4. d.      Donors, potential donors, oversight bodies, and others need to know what percentage of total expenses are being incurred for carrying out the NFP’s programs.