On December 31, 2021, Mr. Eusebio enters into a contract will Brandon Corp, to transfer a license for a fixed fee of P100,000 payable as follows: 20% upon signing of contract and 80% in 4 equal annual installments starting December 31,2022. The appropriate rate is 12%)
On December 31, 2021, Mr. Eusebio enters into a contract will Brandon Corp, to transfer a license for a fixed fee of P100,000 payable as follows: 20% upon signing of contract and 80% in 4 equal annual installments starting December 31,2022. The appropriate rate is 12%)
Required:
Further assume the following on the original problem: (III): The license grants Brandon rights
over Mr. Eusebio's trademark and related proprietary processes for a period of 10 years. The franchise agreement requires Mr. Eusebio to perform initial services to assist Brandon in opening the new restaurant. These include the provision of written guidelines on the standard layout, design, decoration and color scheme of the restaurant and the provision of training. No separate fees are charged for these services. Moreover, the franchise agreement requires Mr. Eusebio to continually undertake activities, such as research and development, and marketing campaigns to support the franchise name. Mr. Eusebio substantially performs all the initial services on Dec. 31, 2021, Brandon commences business operations on Jan. 3, 2022. How much total revenue will Krabs recognize in 2022?
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