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In july 2002, there was a Grant of CU 10 000 to cover the expenses for ecological measures during 20X2 – 20X5. ABC assumes to spend CU 3 000 in 20X2-20X4 and CU 2 000 in 20X5 (CU 14 000 in total).
sir do we have to capitalize the grant 10000 in SOFP? I could not get how to account this amount in financial statements..
How do you get to $14,000? (3 x $3,000) + (1 x $2,000) does not come to $14,000!
I would credit $10,000 to a deferred income account and then spread over the next four years on a pro-rata basis
sir why government grants are called liability? do we have to pay back to government?
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