The City of Alnwick was awarded a grant by Blount County. The $8,000,000 grant is restricted to use for construction of a facility for a city enterprise activity. The grant is for half the cost of the facility. The grantor will reimburse half of the costs as they are incurred. At the end of the first fiscal year, $3,000,000 has been spent on the project. $1,500,000 has been collected from the grantor. How should the grant be reported in the statement of revenues, expenses, and changes in net position?

Question

Quizplus · Accepted Answer

The grant should be reported as a capital contribution of $1,500,000 because it is a restricted grant for the construction of a facility, which is a capital asset, and the city has collected this amount from the grantor based on the costs incurred during the fiscal year.

The City of Alnwick Was Awarded a Grant by Blount