alleryStart learning →Under the capital approach, a grant is treated as part of what?
ALong-term loans
BShareholders funds
CCurrent liabilities
DOperating revenue
Answer & Solution
Correct answer: B. Shareholders funds
The capital approach credits the grant directly to owners' funds rather than to profit.
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Related questions
Rs 8 lakh grant on land, no obligations, deferred income method. Capital reserve credit?Rs 2 lakh asset grant, deferred income, 8-year life. Yearly P and L income?Capital reserve of Rs 25 lakh from a promoters grant; Rs 5 lakh refunded. Reserve left?Asset book value Rs 6.4 lakh rises by a Rs 2 lakh grant refund; 8 years remain, SLM. YearlRevenue grant refund Rs 2 lakh; unamortised deferred credit Rs 1.5 lakh. P and L charge?Rs 4 lakh revenue grant offsets training cost incurred evenly over 4 years. Yearly income?Rs 6 lakh land grant carries obligation costs charged evenly over 5 years. Yearly credit?Rs 3 lakh grant, 5-year asset, SLM. Deferred income balance after 2 years?