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    Government Grant Discussion

    Uploaded by

    Moonchaser
    The document contains 3 problems related to accounting for government grants. Problem 1 shows grant income and cash received over 5 years. Problem 2 calculates grant income using the deferred income approach for a building, recognizing $600k per year in grant income. Problem 3 displays grant cash and income over 3 years for land and roads.

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    Government Grant Discussion

    Uploaded by

    Moonchaser
    34 views2 pages
    The document contains 3 problems related to accounting for government grants. Problem 1 shows grant income and cash received over 5 years. Problem 2 calculates grant income using the deferred income approach for a building, recognizing $600k per year in grant income. Problem 3 displays grant cash and income over 3 years for land and roads.

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    The document contains 3 problems related to accounting for government grants. Problem 1 shows grant income and cash received over 5 years. Problem 2 calculates grant income using the deferred income approach for a building, recognizing $600k per year in grant income. Problem 3 displays grant cash and income over 3 years for land and roads.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    34 views2 pages

    Government Grant Discussion

    Uploaded by

    Moonchaser
    The document contains 3 problems related to accounting for government grants. Problem 1 shows grant income and cash received over 5 years. Problem 2 calculates grant income using the deferred income approach for a building, recognizing $600k per year in grant income. Problem 3 displays grant cash and income over 3 years for land and roads.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    You are on page 1of 2

    PROBLEM 1 1ST

    CASH 30,000,000.00
    YEAR 1 4,000,000.00 6,666,666.67 DEFERRED GRANT INCOME
    YEAR 2 2,000,000.00 3,333,333.33
    YEAR 3 3,000,000.00 5,000,000.00 ENVIRONMENTAL EXP 4,000,000.00
    YEAR 4 4,000,000.00 6,666,666.67 CASH
    YEAR 5 5,000,000.00 8,333,333.33
    18,000,000.00 30,000,000.00 DEFERRED GRANT INCOME 6,666,666.67
    1.67 GRANT INCOME

    PROBLEM 2 DEFERRED INCOME APPROACH


    CASH 75,000,000.00
    75,000,000.00 /25 3,000,000.00 DEFERRED GRANT INCOME

    BUILDING 90,000,000.00
    CASH

    DEFERRED GRANT INCOME 3,000,000.00


    GRANT INCOME

    DEPRECIATION EXP 3,600,000.00


    ACCU. DEP

    NET EFFECT IN THE P/L 600,000.00

    PROBLEM 3

    YEAR 1 10,000,000.00 12,000,000.00 LAND 60,000,000.00


    YEAR 2 10,000,000.00 12,000,000.00 DEFERRED GRANT INCOME
    YEAR 3 30,000,000.00 36,000,000.00
    50,000,000.00 60,000,000.00 ROADS 10,000,000.00
    1.20 CASH

    DEFERRED GRANT INCOME 12,000,000.00


    GRANT INCOME
    30,000,000.00

    4,000,000.00

    6,666,666.67

    DEDUCTION FROM ASSET APPROACH


    BUILDING 90,000,000.00
    75,000,000.00 CASH 90,000,000.00

    CASH 75,000,000.00
    90,000,000.00 BUILDING 75,000,000.00

    BUILDING = 15,000,000.00
    3,000,000.00
    DEPRECIATION EXP 600,000.00
    ACCU. DEP 600,000.00
    3,600,000.00

    NET EXPENSE NET EFFECT IN THE P/L 600,000.00 EXPENSE

    60,000,000.00

    10,000,000.00

    12,000,000.00

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