How do you record grant received in the journal?

Answer 1

To record a grant received in the journal, you would typically make a journal entry that debits the cash or bank account to reflect the increase in funds. Simultaneously, you would credit a grant revenue account to recognize the income. If the grant is designated for a specific purpose, you might also create a liability account to track any unspent funds until they are utilized for their intended purpose. This ensures accurate financial reporting and compliance with grant conditions.