Budget and Financial Planning Flashcards
7 cards from real Grant Writing practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Budget and Financial Planning flashcards as text
Under the Uniform Guidance (2 CFR 200), which of the following costs is generally considered UNALLOWABLE for federal grants?
Answer: Alcoholic beverages purchased for a project celebration
Alcoholic beverages are explicitly listed as unallowable costs under the Uniform Guidance and may not be charged to federal awards.
Which financial document provides a snapshot of an organization's assets, liabilities, and net assets at a specific point in time?
Answer: Statement of financial position (balance sheet)
The statement of financial position (balance sheet) shows what an organization owns (assets), owes (liabilities), and the difference (net assets) at a single date.
A grant applicant calculates fringe benefits at 28% of salaries. If a project director earns $60,000 and is budgeted at 50% effort, what is the correct fringe benefit amount to include?
Answer: $8,400
50% effort on $60,000 salary = $30,000; fringe at 28% of $30,000 = $8,400.
What is the primary risk of underestimating project costs in a grant budget?
Answer: The organization may need to use unrestricted funds to cover project shortfalls
If actual costs exceed the awarded budget, the grantee organization typically must cover the gap with its own unrestricted funds, creating financial strain.
Which principle requires that costs charged to a grant must benefit the project they are charged to?
Answer: Allocability
Allocability means a cost is assignable to a grant in proportion to the benefit the grant receives—costs must be directly connected to project activities.
A nonprofit receives a $200,000 grant with a 15% indirect cost rate applied to direct costs. What is the maximum indirect cost amount?
Answer: $26,087
If indirect costs = 15% of direct costs and total = $200,000: direct + 0.15×direct = $200,000, so direct = $173,913 and indirect = $26,087.
What document do federal grantees use to formally request permission to re-budget funds between approved cost categories?
Answer: A budget modification or prior approval request
When a grantee needs to move funds between budget categories beyond the allowed threshold (often 10%), a prior approval request or budget modification must be submitted to and approved by the awarding agency.