On January 1, 2021, Bongbong 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 countries. The balance of the grant is for subsidizing the tuition costs of those students for four years from date of grant. The building was purchased in January 2021 and is to be depreciated using the 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?

On January 1, 2021, Bongbong 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 countries. The balance of the grant is for subsidizing the tuition costs of those students for four years from date of grant. The building was purchased in January 2021 and is to be depreciated using the 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?

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter3: Income Sources

Section: Chapter Questions

Problem 43P

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