How much grant income should be recognized for friday corp

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Problem 1: Friday Corporation paid P3,000,000 for a varnishing machine at the start of the current year. The firm got a P500,000 government grant for this asset. The firm's accounting policy is to depreciate the asset on a straight-line basis over four years and to consider the grant as deferred revenue. For the current year, how much grant income should be recognized?

a) P500,000

b) P125,000

c) P250,000

d) P0

Reference no: EM132992215

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