Question

Explain how earnings gained from a nonprofit organization are dispersed. How is this different from a for-profit organization?

Answer 1

Answer:

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Explanation:

The money that NPOs make is largely used to keep them going. Employees must be paid. Advertising and publicity have costs. Even fundraising activities have expenses. Still, NPOs are often left with profits. Legally, to keep their nonprofit status, NPOs must continue to benefit the public with their profits. For example, the AHA cannot invest any profit for anyone’s personal gain. NPOs instead use those profits like all their earnings. They simply further their mission to reach their goals. In the case of the AHA, this might mean an increase in research funding or a public-awareness ad campaign.