2. Deduction from asset approach Problem 24-8 (IFRS) Preposterous Company received a government grant of P2,000,000 related to a factory building that it purchased in January 2020 from an...

Extracted text: 2. Deduction from asset approach Problem 24-8 (IFRS) Preposterous Company received a government grant of P2,000,000 related to a factory building that it purchased in January 2020 from an industrialist identified by the government. If the entity did not purchase the building, which was Tocated in the slums of the city, it would have been repossessed by the government agency. The entity purchased the building for P12,000,000. The useftul life of the building is 5 years with no residual value. On January 1, 2021, the entire amount of the goveráment grant became repayable by reason of noncompliance with conditions attached to the grant. Required: Prepare journal entries assuming the government grant is accounted for using: 1. Deferred income approach