Cake Corporation (CC), at the start of its fiscal year, received a Php21,001,400 subsidy from Ph Government to purchase equipment on March 31, 2020. The equipment cost is Php35,700,180 which is equally allocable within eight years with residual value of 6,957,820. The year generated Php8,603,900 revenue with corresponding salaries and administrative expenses of 5,481,345. If CC credited deferred revenue for the subsidy and amortize the grant venue over the equipment life, how much would be the net income at the end of its fiscal year operation?

SWFT Comprehensive Volume 2019
42nd Edition
ISBN:9780357233306
Author:Maloney
Publisher:Maloney
Chapter17: Corporations: Introduction And Operating Rules
Section: Chapter Questions
Problem 45P
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Cake Corporation (CC), at the start of its fiscal year, received a Php21,001,400 subsidy from Ph Government to purchase equipment on March 31, 2020. The equipment cost is Php35,700,180 which is equally allocable within eight years with residual value of 6,957,820. The year generated Php8,603,900 revenue with corresponding salaries and administrative expenses of 5,481,345. If CC credited deferred revenue for the subsidy and amortize the grant venue over the equipment life, how much would be the net income at the end of its fiscal year operation?

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