Chapter 37 - Government Grant: QUESTION 37-11 Multiple Choice (PAS 20)
Chapter 37 - Government Grant: QUESTION 37-11 Multiple Choice (PAS 20)
Chapter 37 - Government Grant: QUESTION 37-11 Multiple Choice (PAS 20)
3. It is a government grant whose primary condition is that an entity qualifying for it should
purchase, construct or otherwise acquire long-term asset.
a. Grant related to asset
b. Grant related to income
c. Government gift
d. Government appropriation
4. A forgivable loan from a government or the benefit of a government loan at NILor below
market interest rate is accounted for as
a. Government grant
b. Government assistance
c. Both government grant and government assistance
d. Neither government grant nor government assistance
3. In the case of grant related to income, which of the following accounting treatment is
prescribed?
a. Credit the grant to equity.
b. Present the grant in the income statement as other income or as a separate
line item or deduct it from the related expense.
c. Credit the grant to retained earnings.
d. Credit the grant to sales.