Problem 1: True or False Fact Pattern In 20x1, Entity X received P2M grant from the government with the condition that the money shall be used to construct a building. Construction was started in 20x1 and was completed on December 31, 20x2 for a total construction cost of P6M. The building is estimated to have a useful life of 10 years. 1. The grant is considered a grant related to assets. 2. The income from the government grant in 20x1 is P200,000. 3. Entity X shall not recognize any income from the government grant until the building is constructed and depreciation starts to be recognized. 4. If no depreciation is recognized on the building, no income is also recognized from the government grant. 5. Income from government grant recognized in 20x2 is P200,000. 6. If entity X uses gross presentation, the carrying amount of the building in the December 31, 20x2 financial statements is P6M. 7. If entity X uses net presentation, the carrying amount of the building in the December 31, 20x2 financial statements is P4M. 8. If entity X uses gross presentation, the depreciation expense in December 31, 20x3 financial statements is P400,000. 9. If entity X uses net presentation, the depreciation expense in the December 31, 20x3 financial statements is P400,000. 10. If entity X uses gross presentation, the carrying amount of the deferred income from the government grant in the December 31, 20x3 financial statements is P1,400,000.