ABC acquired an item of plant at a gross cost of $800,000 on 1 January 2019. The plant has an estimated life of ten years. ABC uses straight-line depreciation on a time apportioned basis. The company received a government grant of 30% of its cost price at the time of its purchase. The terms of the grant are that if the company retains the asset for four years or more, then no repayment liability will be incurred. ABC has no intention to sell the plant within the first four years.

Required:

a) Using any one method, Pass Journal Entries for the year 2019.

b) Prepare Extracts of Financial Statements for the year ended 2019.