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On July 1, 2020, Green Co. (Green) received a government loan for $200,000 to help pay for equipment. The loan was provided interest free, but
On July 1, 2020, Green Co. (Green) received a government loan for $200,000 to help pay for equipment. The loan was provided interest free, but the full principal is due on June 30, 2021. If Green had received the same loan amount and repayment conditions from its bank, the annual interest rate would have been 4%. The discounted value using the effective interest rate is $173,645. Assuming Green reports under IFRS, what is the total amount Green should account for as a government grant?
Question options:
A | $0 |
B | $26,355 |
C | $173,645 |
D | $200,000 |
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