Cost Govt.

grant Depreciation
1/1/2020 5,400,000.00 -
Sometime 5,400,000.00 400,000.00 -
12/31/2020 5,000,000.00 - 1,000,000.00
12/31/2021 5,000,000.00 - 800,000.00
12/31/2022 5,000,000.00 - 640,000.00

Journal Entry
Date
1/1/2020 Machine
Cash

Sometime in 2020 Cash

Machine
Acc. Depreciation Net book value
- 5,400,000.00
- 5,000,000.00
1,000,000.00 4,000,000.00
1,800,000.00 3,200,000.00
2,440,000.00 2,560,000.00

5,400,000.00
5,400,000.00

400,000.00
400,000.00
 Cost Govt. grant Net Cost Depreciation Acc. Depreciation
1/1/2020 6,600,000.00 (600,000.00) 6,000,000.00 - -
12/31/2020 6,600,000.00 (600,000.00) 6,000,000.00 550,000.00 550,000.00
12/31/2021 6,600,000.00 (600,000.00) 6,000,000.00 550,000.00 1,100,000.00
12/31/2022 6,600,000.00 - 6,600,000.00 730,000.00 1,830,000.00
12/31/2023 6,600,000.00 - 6,600,000.00 610,000.00 2,440,000.00

Revision of depreciation

Regular depreciation 550,000.00

Add: Adjustment in the depreciation for 3 years 180,000.00
Depreciation for 2022 730,000.00

Regular depreciation 550,000.00

Add: Depreciation from grant 60,000.00
Depreciation for 2023 610,000.00
Net book value
6,000,000.00
5,450,000.00
4,900,000.00
4,770,000.00
4,160,000.00

=600000 x 3/10