Assume That a Government Received a $5,000,000 Expenditure-Driven Grant in Year

Multiple Choice

Assume that a government received a $5,000,000 expenditure-driven grant in Year 1 for a project that was expected to take three years to complete. Further assume that qualifying expenditures for the project, which actually took four years to complete, were as follows: Year 1-$1,000,000; Year 2-$2,500,000; Year 3-$1,000,000; Year 4-$400,000. Assuming the grant receivable is available in each period, the government should report grant revenues in Year 2 in the amount of

A) $1,000,000.
B) $2,500,000.
C) $3,500,000.
D) $5,000,000.