23-5

1. Cash 30,000,000
Deffered income-government grant 30,000,000
Environmental expenses 2,000,000
Cash 2,000,000
Deferred income-government grant 3,000,000
Income from government grant(30M*2/20) 3,000,000
2. Cash 40,000,000
Deferred income-government grant 40,000,000
Building 50,000,000
Cash 50,000,000
Depreciation 2,500,000
Accumulated depreciation(50,000,000/20) 2,500,000
Deferred income-government grant 2,000,000
Income from government grant(40M/20) 2,000,000
3. Land 50,000,000
Deferred income-government grant 50,000,000
Building 80,000,000
Cash 80,000,000
Depreciation 3,200,000
Accumulated depreciation(80,000,000/25) 3,200,000
Deferred income-government grant 2,000,000
Income from government grant(50,000,000/25) 2,000,000
4. Cash 10,000,000
Income from government grant 10,000,000
23-6
1. Land 12,000,000
Deferred income-government grant 12,000,000
2. Land improvement 2,000,000
Cash 2,000,000
3. Deferred income-government grant 2,400,000
Income from government grant(12M*2/10) 2,400,000
23-7
1. Cash 12,000,000
Deferred income-government grant 12,000,000
2. Building 9,000,000
Cash 9,000,000
3. Depreciation 900,000
Accumulated depreciation 900,000
4. Tuition expense 600,000
Cash 600,000
5. Deferred income-government grant 1,650,000
Income from government grant 1,650,000

Building(9,000,000/10) 900,000
Tuition(3,000,000/4) 750,000
1,650,000
23-8 Requirement 1
1. Machinery 7,000,000
Cash 7,000,000
2. Cash 1,000,000
Deferred income-government grant 1,000,000
3. Depreciation 6,900,000
Accumulated depreciation(7M-500k/5) 6,900,000
4. Deferred income-government grant 200,000
Income from government grant(1M/5) 200,000
Requirement 2
1. Machinery 7,000,000
Cash 7,000,000
2. Cash 1,000,000
Machinery 1,000,000
3. Depreciation 1,100,000
Accumulated depreciation(6M-500k/5) 1,100,000
23-9 Requirement 1
1. Machinery 5,400,000
Cash 5,400,000
2. Cash 400,000
Deferred income-government grant 400,000
3. Depreciation 1,080,000
Accumulated depreciation(5.4M*20%) 1,080,000
4. Deferred income-government grant 80,000
Income from government grant(400k*20%) 80,000
Requirement 2
1. Machinery 5,400,000
Cash 5,400,000
2. Cash 400,000
Machinery 400,000
3. Depreciation 1,000,000
Accumulated depreciation(5,000,000*20%) 1,000,000
23-11 Deferred income approach
2013
Jan.1 Building 12,000,000
Cash 12,000,000
1 Cash 2,000,000
Deferred income-government grant 2,000,000
31 Depreciation 2,400,000
Accumulated depreciation(12,000,000/5) 2,400,000
31 Deferred income-government grant 400,000
Income from government grant(2M/5) 400,000
2014
Jan.1 Deferred income-government grant 1,600,000
Loss on government grant 400,000
Cash 2,000,000
31 Depreciation 2,400,000
Accumulated depreciation 2,400,000
Deduction from asset approach
2013
Jan.1 Building 12,000,000
Cash 12,000,000
2013
Jan.1 Cash 2,000,000
Building 2,000,000
Dec.3 Depreciation 2,000,000
Accumulated depreciation(10,000,000/5) 2,000,000
2014
Jan.1 Building 2,000,000
Cash 2,000,000
Dec.3 Depreciation 2,800,000
Accumulated depreciation 2,800,000

Original carrying amount 2,000,000

Increased carrying amount(2,000,000/5*2) 800,000
Total depreciation 2,800,000
23-12 D
Income(60,000,000*2/30) 4,000,000
23-13 A
Income(15,000,000/10) 1,500,000
23-14 A
Cost 6,000,000
Accumulated depreciation(6M/4*2) (3,000,000)
Carrying amount-12/31/2014 3,000,000

Deferred income 540,000

Income earned(540,000/4*2) (270,000)
Deferred income-12/31/2014 270,000
23-15 Question 1: B
Cost 3,000,000
Accumulated depreciation(3M/4) (750,000)
Carrying amount-12/31/2013 2,250,000
Question 2: B
Income(500,000/4) 125,000
23-16
Cost 3,600,000
Government grant (500,000)
Net cost 3,100,000
Residual value (50,000)
Depreciable amount 3,050,000

Annual depreciation(3,050,000/8) 381,250

23-17 B
Original carrying amount(5M/10) 500,000
Increased carrying amount(1M/10*6) 600,000
Total depreciation for 2013 1,100,000
23-18 D
Total grant received 1,500,000
Income recognized in 2013&2014(1.5M/5*2) (600,000)
Deferred income-Dec.31,2014 900,000
23-19 D
Acquisition cost net of grant(5.4M-400k) 5,000,000
Accumulated depreciation:
2013(5,000,000*20%) 1,000,000
2014(4,000,000*20%) 800,000 (1,800,000)
Carrying amount-Dec. 31, 2014 3,200,000

Repayment 1,200,000
Deferred income balance (900,000)
Loss on repayment 300,000
23-20
Acquisition cost of net grant(5.4M-400k) 5,000,000
Accumulated depreciation:
2013(5,000,000*20%) 1,000,000
2014(4,000,000*20%) 800,000 (1,800,000)
Carrying amount-Dec. 31, 2014 3,200,000