$9\backslash$

Bucks SA is provided a grant by the local government to purchase land for a building site$$The grant is a low$$interest loan of $$5,000,000$issued as a $5$year$2\%$ note on January $2,2025$Interest on the note is payable annually on each December $31$Bucks$$ incremental borrowing rate is $6\%$The land is not purchased until July $152025.$

$p_{5,6\%}=0\mathrm{.}74726,P_{5,6\%}=4\mathrm{.}21236,p_{5,2\%}=0\mathrm{.}90573,P_{5,2\%}=4\mathrm{.}71346$

Instructions

a$$Prepare the journal entry to record the grant and note payable on January $220254\backslash$

b$$Prepare the journal entries to record interest expense and grant revenue on December $3120255\backslash$