On 1 January 20X6, Lotte received a $30,000 government grant relating to equipment which cost $90,000 and
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Question:
On 1 January 20X6, Lotte received a $30,000 government grant relating to equipment which cost $90,000 and had a useful life of six years. The grant was netted off against the cost of the equipment. On 1 January 20X7, when the equipment had a carrying amount of $50,000, its use was changed so that it was no longer being used in accordance with the grant. This meant that the grant needed to be repaid in full, but by 31 December 20X7, this had not yet been done.
Required:
Explain the accounting treatment of the above transaction in the financial statements of Lotte
Related Book For
Modern Advanced Accounting in Canada
ISBN: 978-1259087554
7th edition
Authors: Hilton Murray, Herauf Darrell
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