Question

question 6

depreciation measures the loss in value of capital assets.

question 7

fund balance is a term used by not-for-profit or government organizations.

true
false

Explanation:

🆕 New Concept Discovered: Fund Accounting
The unique net asset representation for non-business entities.

Step 1: Define Fund Balance

In commercial accounting, the difference between assets and liabilities is referred to as owner's equity or shareholders' equity. However, because governments and non-profit organizations do not have owners, they use fund accounting. In this context, the difference between assets and liabilities within a fund is called the Fund Balance (or Net Assets).

Step 2: Evaluate the Statement

The statement asserts: "Fund balance is a term used by not-for-profit or Government organizations."

Since "fund balance" is specifically used in governmental and non-profit accounting to represent the net position of a fund, this statement is correct.

Answer:

True