Performance Reports in Nonprofit Organizations

Performance Reports in Nonprofit Organizations

The performance reports in nonprofit organizations are basically the same as the performance reports we have considered so far—with one prominent difference. Nonprofit organizations usually receive a significant amount of funding from sources other than sales. For example, universities receive their funding from sales (i.e., tuition charged to students), from endowment income and donations, and—in the case of public universities—from state appropriations. This means that, like costs, the revenue in governmental and nonprofit organizations may consist of both fixed and variable elements. For example, the Seattle Opera Company‘s revenue in a recent year consisted of grants and donations of $12,719,000 and ticket sales of $8,125,000 (or about $75.35 per ticket sold). Consequently, the revenue formula for the opera can be written as:


where q is the number of tickets sold. In other respects, the performance report for the Seattle Opera and other nonprofit organizations would be similar to the performance report in  Exhibit 9–7 .

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