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    Question

    If a government grant is received but later becomes

    refundable, how should it be accounted? 
    A By recording it under contingent liabilities Correct Answer Incorrect Answer
    B As an expense in the year of refund Correct Answer Incorrect Answer
    C By treating it as a liability in the financial statements Correct Answer Incorrect Answer
    D By adjusting it against future government grants Correct Answer Incorrect Answer

    Solution

    The correct answer is C

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