Please show your solution in good accounting form. Thank you! Each of ABC's 12 new franchisee contracted to pay an initial franchise fee of P50,000. By December 31, 2021, eachfranchisee had paid a non-refundable P5,000 fee and signed a note to pay P20,000 principal plus interest rate of 10% onDecember 31, 2022 and December 31, 2023. Experience indicates that three franchises will default on the additionalpayments. Service for the initial franchise fee will be performed in 2022. What amount of franchise revenue would ABCrecognize on December 31, 2021?

The franchise income is recognized at the time of performing the service and receiving of payment…

Answered: ranchisee had paid a non-refundable…

ranchisee had paid a non-refundable P5,000 fee a December 31, 2022 and December 31, 2023. Exp mayments. Service for the initial franchise fee will ber 20212

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Please show your solution in good accounting form. Thank you!

Each of ABC's 12 new franchisee contracted to pay an initial franchise fee of P50,000. By December 31, 2021, each
franchisee had paid a non-refundable P5,000 fee and signed a note to pay P20,000 principal plus interest rate of 10% on
December 31, 2022 and December 31, 2023. Experience indicates that three franchises will default on the additional
payments. Service for the initial franchise fee will be performed in 2022. What amount of franchise revenue would ABC
recognize on December 31, 2021?

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