On March 31, 20x1, ABC Company provides a license to Mr. X. Under the license agreement, Mr. X pays a non-refundable upfront fee of P200,000. The license agreement provides Mr. X the right to access the license for 5 years. 1. How much should ABC Company recognized as revenue in the first year of the contract on December 31, 20x1? 2. How much should ABC Company recognized as revenue in the first year of the contract if Mr. X has the right to use the license on December 31, 20x1?

On March 31, 20x1, ABC Company provides a license to Mr. X. Under the license agreement, Mr. X pays a non-refundable upfront fee of P200,000. The license agreement provides Mr. X the right to access the license for 5 years. 1. How much should ABC Company recognized as revenue in the first year of the contract on December 31, 20x1? 2. How much should ABC Company recognized as revenue in the first year of the contract if Mr. X has the right to use the license on December 31, 20x1?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter3: Review Of A Company's Accounting System

Section: Chapter Questions

Problem 5RE: Garcia Company rents out a portion of its building to Jerry Company for 1,000 per month. On August...

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