On January 2, 2011, Blink Corporation was granted 5,000 acres of land in a village, located near the slums outside city limits, by a local government authority. The condition attached to this grant was that Blink Corporation should clean up this land and lay roads by employing laborers from the village in which the land is located. The government has fix the minimum wage payable to the workers. The entire operation will take three years and is estimated to cost P100,000,000. This amount will be spent in this way, P20,000,000 each in the first, P30,000,000 in the second years and P50,000,000 in the third year. The fair value of the land is currently P120,000,000.
What portion of the grant is recognized for the year ended December 31, 2012?
Step by step
Solved in 2 steps
