One July 1, 2020 Bob signed an agreement to operate as a franchisee of abc co for an initial franchise fee. A down payment was paid when the agreement was signed and the balance is payable in 4 equal annual payments of $35,000 beg July 1, 2021 The agreement provides that the down paymetn is not refundable and no future services are required of the franchisor Bob's credit rating indicates that he can borrow money at 14% for a loan of this type If Bob records the acquisition cost at $196,400 then how much was the down payment?

One July 1, 2020 Bob signed an agreement to operate as a franchisee of abc co for an initial franchise fee. A down payment was paid when the agreement was signed and the balance is payable in 4 equal annual payments of $35,000 beg July 1, 2021 The agreement provides that the down paymetn is not refundable and no future services are required of the franchisor Bob's credit rating indicates that he can borrow money at 14% for a loan of this type If Bob records the acquisition cost at $196,400 then how much was the down payment?

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 61P

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