Which of the following would be considered contribution revenue or support under FASB?

• A. Government assistance recognized as revenue
• B. Employee wages paid by the organization
• C. Sale of donated goods
• D. Contributions from donors without restrictions

Answer: (D)

In FASB accounting for not-for-profit organizations, contribution revenue or support comes from voluntary transfers of assets from donors where the organization does not provide commensurate goods or services in return. Donor gifts that come without any restrictions are the classic example of this type of revenue because they are given to support the organization’s mission without strings attached.

That’s why contributions from donors without restrictions fit best. They are unconditional gifts that increase the organization’s net assets as contributions. Other items don’t fit as contribution revenue: government assistance is a separate category of government grants and is not classified as contribution revenue; wages paid to staff are expenses, not revenue; and the sale of donated goods is considered revenue from an exchange, not a contribution, even though the goods were donated, because the sale involves a transaction with a buyer and is not a nonreciprocal transfer of assets.