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Question - TALLNUT CORP. was granted by the local government of Bula, Camarines Sur a 5-hectare land on January 1, 2022 for the planting of narra trees. The grant has a fair value of P 500,000. The grant requires that TALLNUT to farm only within Bula, Camarines Sur for five years and require the entity to return part of the grant if it farms for a period shorter than five years taking into consideration the portion retained based on passage of time.
On January 1, 2025, TALLNUT violated the terms and conditions of the grant and the grant becomes repayable.
Required - Prepare all necessary entries on 2022 until the repayment of the grant.
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