On January 1, 2019, Munich Co. received a grant of P10,000,000 from the government of USA for the construction of a building that will be used as a laboratory and research facility with an estimated cost of P15,000,000 and useful life of 10 years. The facility was completed on January 1, 2020. How much is the balance of deferred income from government grant on December 31, 2020 under the gross method (deferred income approach)?
Q: __________1. Loss on repayment of government grant on January 1, 2023 if the company accounts for…
A: Answer 1. If the government grant is accounted as deferred income, then deferred income will be…
Q: 3. On May 10, 2019, GUAVA Company received a grant of P8,000,000 from the British Government for the…
A: ‘’Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: During 2020, Israel Company constructed asset costing P4,215,000. The weighted average accumulated…
A: Calculation of capitalization rate for general borrowing : Loan / Note Payable…
Q: How much income from government grant will Entity A recognize? * On January 1, 2021, Entity A…
A: As per IAS 20 : Accounting for government grants and disclosure of government assistance "If any…
Q: On December 10, 2020 the Elm Street project was completed and the contractor for the project…
A: Journal entries in Street improvement fund Date Particulars Debit Credit December 10 Reserve…
Q: n January 1, 2021, Entity A received land with fair of PHP 200,000 from the govermment nditioned on…
A: In the given case Entity A receives from Government PHP 200,000 for constuction of building purpose.…
Q: On January 1, 2021, Robin Company received a grant of P1,500,000 frorm the government to subsidize…
A: The grant is the amount that is received from the government to fulfill a certain activity. It is a…
Q: On January 1, 2014, Valiant Company received a Government grant of P60,000,000 to compensate for the…
A: solution: On January 1, 2014, Valiant Company received a Government grant of P60,000,000 to…
Q: On January 1, 2022, ABC Organization, a non-profit private organization, received the gift of a…
A: On January 1, 2022, ABC Organization booked the building at the fair value at date of donation i.e.…
Q: On January 1, 2022, Annibelle Company received a grant of P9,000,000 from the foreign government in…
A: Government grants are grants received by the company from government in monetary form, where these…
Q: On May 10, 2019, GUAVA Company received a grant of ₱8,000,000 from the British Government for the…
A: Solution: The whole amount of 10000000 because when on May 10, 2019, the amount 8000000 was a…
Q: SKOLAR started constructing a building to be used for producing its goods in January 2021. ISKOLAR…
A: solution concept as per the provision of PAS 23 borrowing cost , borrowing cost incurred for the…
Q: Marauder Company borrowed P15,000,000 at 12% to finance in part the construction of a new building…
A: Given data, Company borrowed P15,000,000 at 12% interest rate Expenditure =P10,000,000 ●1.What…
Q: 21) On January 1. 2021, Nola Company received a grant of P50 million from a foreign government for…
A: Lets understand the basics. As per IAS 20 "Accounting for government grant", when any grant is…
Q: On Jan. 1, 2021, Microsoft Company received a consolidated grant of P12,000,000. Three-fourths of…
A: Grants means the amount received without any sale of product or providing any services. Government…
Q: On January 1, 2021, Robin Cormpany received a grant of P1,500,000 from the government to subsidize…
A: Government Grant: Instead than acting as an incentive to carry out specified expenditures, a…
Q: 17. Ebasan Company received a grant of P60,000,000 to compensate it for costs it incurred in…
A: Solution Concept As per the provision of PAS 20 , The grant received to compensate for its cost…
Q: Surgimed Ghana Ltd. received a government grant of GH¢300,000 for acquiring plant and machinery…
A: Every company will prepare the accounting statements based on the transactions, and nature of the…
Q: Topic: Government Grants Entity A received land with fair value of P 200,000 from the government…
A: Answer - Correct Option is b. P 0 and P 20,000, respectively
Q: The entity will incur such costs at 2,000,000 for 2017, 4,000,000 for 2018, 6,000,000 for 2019,…
A: As per provisions government grant should be recognized in profit and loss on a systematic basis…
Q: At the beginning of current year, Exuberant Company received a consolidated grant of P12,000,000.…
A: Grants means the amount received without any sale of product or providing any services. When grants…
Q: On January 1, 2021, Bongbong Company received a consollidated grant of P 12,000,000. three-fourths…
A: IAS 20 outlines accounting and recognition of government grants. In case grant is related to…
Q: 3. On May 10, 2019, GUAVA Company received a grant of ₱8,000,000 from the British Government for the…
A: On 10.05.2019, GUAVA company received a grant from British government = P8000000 This grant is…
Q: G-Waste Limited, a leading waste management company, acquired a parcel of land on January 1, 2014 at…
A: Whenever it is required to restore the land at the end of useful life, the cost required to restore…
Q: The grant income to be recognized in the second year should be?
A: The grant income that would be recognized each year would be in proportion to research expenses…
Q: What amount of income from the government grant is recognized for the current year?
A: Grant is the government aid which is given by the government to the company in order to support and…
Q: Jen Company had a 10% P3,000,000 specific construction loan and 12% P25,000,000 general loan…
A: The question is based on the concept of Accounting Standard on Borrowing Cost.
Q: Bright Co. received a government grant of 10,000,000 to install and run a windmill in an…
A: As per IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, the…
Q: As of Jan. 1, 2020, ABC Corporation is constructing a new facility located in a community that has…
A: Government Grant related to assets recognized in profit & loss account over the useful life of…
Q: 22) Maker Company purchased a varnishing machine for P450,000 on January 1. 2023. The company…
A: As Given on January 1, 2023, the manufacturer firm acquired a varnishing equipment for P 450.000. In…
Q: For each item, indicate if it is included in the capitalized cost of the machinery. What is the…
A: Hi student Since there are multiple questions, we will answer only first question.
Q: Snowbird Company is constructing a building that qualifies for interest capitalization. It is built…
A: Interest on Specific borrowing is to be capitalized from 1st April (Date from which recognition…
Q: During 2020, ABC Co. incurred these expenditures relating to its plant building: Continuing and…
A: Expenses should be capitalized = P184,000
Q: On January 1, 2020, CDO Corporation created a special building fund by depositing a single sum of…
A: Trust Fund: It is the fund containing assets that is held by the trustees for the beneficiaries.…
Q: On January 1, 20X2, ABC Company received a consolidated grant of P40,000,000. Three-fourths of the…
A: SOLUTION- GOVERNMENT GRANT - IT IS A FINANCIAL AID BY THE FEDERAL GOVERNMENT TO THE GRANTEE IN…
Q: On January 1, 20x1, ABC Co. received 2,000,000 grant from the government to aid in the construction…
A: Government grants are the financial assistance provided by the government to an entity to buy an…
Q: The government charges OMR 400,000 general property taxes for the year 2019. The amount collected…
A: General Fund is the primary fund of the Government which can be used for any general purpose and not…
Q: Colorado Construction Co., a private company that reports under ASPE, was contracted by a provincial…
A:
Q: A Corporation began construction work in 2019 for a project with a contract price of P8,000,000. The…
A: >Contract accounting involves complex estimates and calculations.>This is because the contract…
Q: On January 1, 2021, Robin Cormpany received a grant of P1,500,000 frorm the governiment to subsidize…
A: Solution This question relates to standard accounting for government grants Whenever the grant is…
Q: For the 2019 fall semester, Forest Public University assessed its students $6,000,000 (net of…
A:
Q: Financing for the renovation of Mink City’s municipal park, begun and completed during 2019, came…
A: Given information: Grant from state government = $400,000Proceeds from general obligation bond =…
Q: What is the answer and how do you get the answer? Dixon Development began operations in December…
A: The question is based on the concept of Journal entry
Q: On 1 January 2020, Entity A contracted with Entity B to construct a residential building for…
A: Answer - Working Notes - Part 1 - The interest payable - Given - $7,500,000 borrowed for 2 years…
Q: On January 1, 2021, Bongbong Company received a consolidated grant of P12,000,000. Three-fourths of…
A: Given data: - Amount of grant=12,000,000 Grant for college building= 3/4th of total grant Life of…
Q: bri municipality begun a park renovation and completed it during the year 2019, sources from the…
A: Special Revenue funds : In government accounting, there are various types of funds which…
Q: On January 1, 2020, Humility Company received a government grant of P60,000,000 to compensate for…
A: In accordance with PAS 20 "The grant is recognized as income over the period by matching them with…
Q: Surgimed Ghana Ltd. received a government grant of GH¢300,000 for acquiring plant and machinery…
A:
Q: On January 1, 2021, Annibelle Company received a grant of P9,000,000 from the foreign government in…
A: Government grants are the amounts or assistance that is received by organisation from the…
On January 1, 2019, Munich Co. received a grant of P10,000,000 from the government of USA for the construction of a building that will be used as a laboratory and research facility with an estimated cost of P15,000,000 and useful life of 10 years. The facility was completed on January 1, 2020.
How much is the balance of deferred income from government grant on December 31, 2020 under the gross method (deferred income approach)?
Step by step
Solved in 2 steps
- On January 1, 2022, Annibelle Company received a grant of P9,000,000 from the foreign government in order to defray safety and environmental costs within the area where the entity is located. The safety and environmental costs are expected to be incurred over three years, respectively, P1,000,000, P2,000,000 and P3,000,000. What income from the government grant should be recognized in 2022? A. 9,000,000 В. 1,500,000 С. 3,000,000 D. 4,500,000On January 1, 2021, Annibelle Company received a grant of P9,000,000 from the foreign government in order to defray safety and environmental costs within the area where the entity is located. The safety and environmental costs are expected to be incurred over three years, respectively, P1,000,000, P2,000,000 and P3,000,000. What income from the government grant should be recognized in 2021?On January 1, 2021, Robin Cormpany received a grant of P1,500,000 frorm the government to subsidize tuition fees for a period of 5 years. On January 1, 2023, the entity violated certain conditions attached to the grant, and therefore had to repay such grant to the government. What amount should be recognized as loss resulting from the repayment of the grant in 2023?
- On January 1, 2021, ALI Inc. received P2,000,000 from national government on the condition that the company will construct an environmentally-friendly building with a cost of P13,000,000 and useful life of 10 years and residual value of P1,000,000. On January 1, 2023, the government grant became repayable as a result of ALI Inc.’s failure to comply with the environmentally-friendly specification requirement of the government grant condition. __________1. Loss on repayment of government grant on January 1, 2023 if the company accounts for the government grant as deferred income__________2. Depreciation expense for the year ended December 31, 2023, if the company accounts for the government as deduction from the cost of the assetSurgimed Ghana Ltd. received a government grant of GH¢300,000 for acquiring plant and machinery costing GH¢1,500,000 during 2017 financial year and having a useful life of 10 years. The grant received was credited to deferred income in the statement of financial position as a result of adopting the deferred income approach of accounting for government grant. During the 2020 financial year, the company had to refund the grant to the government due to non-compliance of the conditions laid down for the grant. Required: (i) Explain to directors of Surgimed Ghana Ltd. what should be the appropriate treatment of the refund of the grant. (ii) Explain the effect on the cost of the plant and machinery, and the amount of depreciation that should be charged during the 2020 financial year financial statements.Surgimed Ghana Ltd. received a government grant of GH¢300,000 for acquiring plant and machinery costing GH¢1,500,000 during 2017 financial year and having a useful life of 10 years. The grant received was credited to deferred income in the statement of financial position as a result of adopting the deferred income approach of accounting for government grant. During the 2020 financial year, the company had to refund the grant to the government due to non-compliance of the conditions laid down for the grant. Required Explain to directors of Surgimed Ghana Ltd. what should be the appropriate treatment of the refund of the grant. Explain the effect on the cost of the plant and machinery, and the amount of depreciation that should be charged during the 2020 financial year financial statements.
- On January 1, 2021, Bongbong Company received a consollidated grant of P 12,000,000. three-fourths of the grant will will be utilized to purchase a college building for students from underdeveloped countries. The balance of the grant is for subsidizing the tuition cost of those students for four years from date of grant. The building was purchased in January 2021 and is to be depreciatedusing the straight-line method over 10 years. the tuition costs paid in 2021 amounted to P 600,000. How much income from government grant should be recognized for 2021?Transaction ESurgimed Ghana Ltd. received a government grant of GH¢300,000 for acquiring plant and machinery costing GH¢1,500,000 during 2017 financial year and having a useful life of 10 years. The grant received was credited to deferred income in the statement of financial position as a result of adopting the deferred income approach of accounting for government grant. During the 2020 financial year, the company had to refund the grant to the government due to non-compliance of the conditions laid down for the grant. RequiredExplain to directors of Surgimed Ghana Ltd. what should be the appropriate treatment of the refund of the grant. Explain the effect on the cost of the plant and machinery, and the amount of depreciation thatshould be charged during the 2020 financial year financial statements.The government charges OMR 400,000 general property taxes for the year 2019. The amount collected till the year end accounted to OMR 360,000. It expects to collect the balance shortly after year-end. These taxes are accounted as unrestricted resources to be used for financing of operating activities that would contribute towards public welfare. During the year, the government incurred OMR 330,000 in general operating expenditures of which it actually paid OMR 310,000. To cover up the capital project fund deficit of 2018, the government had borrowed funds by issuing long term notes amounting to RO 50,000. A debt service fund was created and an amount of OMR 40,000 is transferred from the general fund to service the debt. Based on the above case, which among the following statements are true? a. The unrestricted resources are accounted in the General fund and the cash balance in the fund statement amounts to RO OMR 10,000 b. The unrestricted resources are accounted in the Debt service…
- On Jan. 1, 2021, Microsoft Company received a consolidated grant of P12,000,000. Three-fourths of the grant will be utilized to purchase a college building for students from underdeveloped or undeveloped countries. The balance of the grant is for subsidizing the tuition costs of those students for five years from the date of grant. The building was purchased in Jan. 1, 2021 and is to be depreciated using straight-line method over 10 years. The tuition costs paid in 2021 amounted to P600,000. How much income from government grant should be recognized for 2021? a. P 1,500,000b. P 3,000,000c. P 1,900,000d. P 1,650,000On January 1, 2017, Humble company received a government grant of 60,000,000 to compensate for costs to be incurred in planting trees over a period of 5 years. The entity will incur such costs at 2,000,000 for 2017, 4,000,000 for 2018, 6,000,000 for 2019, 8,000,000 for 2020, and 10,000,000 for 2021. What amount of income from the government grant is recognized for 2017?On January 1, 2021, Raquel Company purchased a machine for 3,000,000. The entity received a government grant of 500,000 in respect of this asset. The policy is to depreciate the asset over 5 years on a straight line basis and to treat the grant as deferred income. On January 1, 2023, the grant became fully repayable because of non compliance with conditions. Required: Prepare journal entries for 2021, 2022 and 2023.