CAF-1 · Chapter 7 · Question 6 of 15
Omega Dairies receives a government grant on the condition that it farms using organic methods for five years. If it stops, the full grant must be repaid. How is this grant recognized?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Only when the five-year condition is completely met.
Explanation
If a government grant related to a biological asset is conditional, the entity recognizes the grant as income when, and only when, the conditions attaching to the grant are met.
More IAS 41 Agriculture MCQs
- Q8Which of the following processes is NOT a component of 'biological transformation' as defined by IAS 41?
- Q9Which of the following distinguishes agricultural activity from other activities like ocean fishing or deforestation?
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- Q11Which of the following is considered a 'consumable' biological asset rather than a 'bearer' biological asset?
- Q12Under IAS 41, what is meant by the term 'harvest'?