RuralCo Received a $100 000 Grant from the Government on 1

RuralCo received a $100 000 grant from the government on 1 July 2013. One of the conditions attached to the grant was the Rural Co had to continue farming in the same location for the next 2 years, otherwise the grant would have to be retuned in full.
The entry to record the receipt of the grant is:

A) DR Cash 100 000 CR Revenue 100 000
B) DR Cash 100 000 CR Revenue 50 000
CR Performance obligation 50 000
C) DR Cash 100 000 CR Performance obligation 100 000
D) No entry required as the grant is conditional and cannot be recognised until the conditions attached to the grant are met.

Correct Answer:

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