In December 2016, Technology University Received a $2 Million Grant

question 53

Essay

In December 2016, Technology University received a $2 million grant from the National Hockey Association to develop an effective neck brace to prevent injuries in its non-goalie hockey players. The NHA grant was intended to cover $1.5 million of direct costs and $0.5 million of overhead costs. The grant stipulated that the NHA would be the sole beneficiary of the research. Technology carried out the research in 2017. As anticipated, direct costs were $1.5 million.
REQUIRED:
a. What accounting entries, if any, should Technology make when notified of the grant?
b. What accounting entries, if any, should Technology make in 2017? (Be sure to indicate in which funds the entries would be recorded.)
c. Would your answer be different if the research were made available to the general public and not just the NHA? Explain.
d. Would your answer be different if the NHA indicated it would not make any payments on the research until Technology delivered the final research product?

---

Definitions:

Honest Feedback

Open and truthful comments or critiques aimed at improving or evaluating someone's performance or behavior.

Disclosing Identities

Revealing or making known the identity of an individual, often in contexts where anonymity was previously maintained.

Internet Service Provider

A company that provides individuals and organizations access to the Internet and related services.

Webmail Account

A webmail account is an email account that can be accessed using a web browser, allowing users to manage their emails without the need for an email client.