Question

A not-for-profit entity has all of the following characteristic except that it will ______________.

• A. Operate for purposes other than to provide goods or service at a profit
• B. Not have a positive fund balance
• C. Not possess ownership interests like a corporation
• D. Receive significant contributions from providers who do not expect returns.

Answer 1

The correct option is B Not have a positive fund balance

As the name suggest not-for-profit entity works to provide social services and doesn't relate any of its activity with profit.

A positive fund balance is obtained when the entity earns profits due an economic transaction. Since, the company is not involved in any kind of profit and hence it will not have a positive fund balance.