In 2021, Waverly Corp

question 31

Multiple Choice

In 2021, Waverly Corp. set up a new manufacturing facility in Nova Scotia. To encourage Waverly to set up its factory, the province provided equipment with a fair value of $250,000 and an estimated useful life of 15 years using straight-line depreciation. What journal entry would be required to record the equipment contribution in fiscal 2021, using the gross method?

• A)A credit to donation revenue of $250,000.
• B)A credit to other comprehensive income - donated assets of $250,000.
• C)A credit to deferred income of $250,000.
• D)A credit to property, plant and equipment for $250,000.

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Definitions:

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Organizational Buyer

Entities such as companies, governments, and institutions that purchase goods or services for use in their operations, production, or resale.

Roommates

Individuals sharing living accommodations, typically to reduce living expenses.

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Disposable towels made of paper used for drying hands, wiping surfaces, or cleaning spills, known for their absorbency and convenience.