Reference no: EM132922236

Question - What is the year- end compound journal entry for the for the following cases:

1. 15,000,000 government grant was received so that the entity will hire indigent individuals. Estimated wages to be incurred is: Year 1 = 2,000,000, Year 2 = 3,000,000, Year 3 = 4,000,000, Year 4 = 4,000,000 and Year 5 = 3,000,000. The entity accounted the grant income as other income. For journal entry requirements, it is sufficient to include the account titles, parenthetical computations and amounts.

2. 5,000,000 government grant was received to subsidize a machinery that produces significantly lower carbon emissions. The machinery is to be depreciated using the straight-line method for 8 years. The entity accounts the grant as a deduction from the carrying value of the machinery. For journal entry requirements, it is sufficient to include the account titles, parenthetical computations and amounts.

3. A 10-year, non-interest bearing, 20,000,000 term loan was received from the government. Without the loan from the government, the entity would need to pay 8% interest per year. For journal entry requirements, it is sufficient to include the account titles, parenthetical computations and amounts.