On January 1, 2025, Barbara Brown signed an agreement, covering 5 years, to operate as a franchisee of Ivanhoe Inc. for an initial franchise fee of $51,000. The amount of $11,000 was paid when the agreement was signed, and the balance is payable in five annual payments of $8,000 each, beginning January 1, 2026. The agreement provides that the down payment is nonrefundable and that no future services are required of the franchisor once the franchise commences operations on April 1, 2025. Barbara Brown's credit rating indicates that she can borrow money at 7% for a loan of this type. Click here to view the factor table. Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries.) Date Account Titles and Explanation Jan. 1, 2025 Cash Notes Receivable Discount on Notes Receivable Unearned Franchise Revenue Apr. 1, 2025 Unearned Franchise Revenue Franchise Revenue Dec. 31, 2025 Discount on Notes Receivable Interest Revenue Debit 11000 40000 43802 2296 Credit 7198 43802 43802 2296 Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement, assuming that in addition to the franchise rights, Ivanhoe also provides 1 year of operational consulting and training services, beginning on the signing date. These services have a value of $3,100. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit = St
On January 1, 2025, Barbara Brown signed an agreement, covering 5 years, to operate as a franchisee of Ivanhoe Inc. for an initial franchise fee of $51,000. The amount of $11,000 was paid when the agreement was signed, and the balance is payable in five annual payments of $8,000 each, beginning January 1, 2026. The agreement provides that the down payment is nonrefundable and that no future services are required of the franchisor once the franchise commences operations on April 1, 2025. Barbara Brown's credit rating indicates that she can borrow money at 7% for a loan of this type. Click here to view the factor table. Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries.) Date Account Titles and Explanation Jan. 1, 2025 Cash Notes Receivable Discount on Notes Receivable Unearned Franchise Revenue Apr. 1, 2025 Unearned Franchise Revenue Franchise Revenue Dec. 31, 2025 Discount on Notes Receivable Interest Revenue Debit 11000 40000 43802 2296 Credit 7198 43802 43802 2296 Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement, assuming that in addition to the franchise rights, Ivanhoe also provides 1 year of operational consulting and training services, beginning on the signing date. These services have a value of $3,100. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit = St
Chapter16: Tax Research
Section: Chapter Questions
Problem 52RC
Related questions
Question
![On January 1, 2025, Barbara Brown signed an agreement, covering 5 years, to operate as a franchisee of Ivanhoe Inc. for an initial
franchise fee of $51,000. The amount of $11,000 was paid when the agreement was signed, and the balance is payable in five annual
payments of $8,000 each, beginning January 1, 2026. The agreement provides that the down payment is nonrefundable and that no
future services are required of the franchisor once the franchise commences operations on April 1, 2025. Barbara Brown's credit
rating indicates that she can borrow money at 7% for a loan of this type.
Click here to view the factor table.
Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement. (Credit account titles are automatically indented when the amount
is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to
5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries.)
Date
Account Titles and Explanation
Jan. 1, 2025
Cash
Notes Receivable
Discount on Notes Receivable
Unearned Franchise Revenue
Apr. 1, 2025
Unearned Franchise Revenue
Franchise Revenue
Dec. 31, 2025
Discount on Notes Receivable
Interest Revenue
Debit
11000
40000
43802
2296
Credit
7198
43802
43802
2296
Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement, assuming that in addition to the franchise rights, Ivanhoe also provides 1
year of operational consulting and training services, beginning on the signing date. These services have a value of $3,100. (Credit account titles are automatically indented
when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor
calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries. Record journal entries in the order
presented in the problem.)
Date
Account Titles and Explanation
Debit
Credit
= St](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F184bd72b-852d-4464-92e5-6b9b7ba215cc%2F273bd897-ce48-4020-b8fc-47a5599de4f8%2F7ja7fb_processed.png&w=3840&q=75)
Transcribed Image Text:On January 1, 2025, Barbara Brown signed an agreement, covering 5 years, to operate as a franchisee of Ivanhoe Inc. for an initial
franchise fee of $51,000. The amount of $11,000 was paid when the agreement was signed, and the balance is payable in five annual
payments of $8,000 each, beginning January 1, 2026. The agreement provides that the down payment is nonrefundable and that no
future services are required of the franchisor once the franchise commences operations on April 1, 2025. Barbara Brown's credit
rating indicates that she can borrow money at 7% for a loan of this type.
Click here to view the factor table.
Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement. (Credit account titles are automatically indented when the amount
is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to
5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries.)
Date
Account Titles and Explanation
Jan. 1, 2025
Cash
Notes Receivable
Discount on Notes Receivable
Unearned Franchise Revenue
Apr. 1, 2025
Unearned Franchise Revenue
Franchise Revenue
Dec. 31, 2025
Discount on Notes Receivable
Interest Revenue
Debit
11000
40000
43802
2296
Credit
7198
43802
43802
2296
Prepare journal entries for Ivanhoe for 2025-related revenue for this franchise arrangement, assuming that in addition to the franchise rights, Ivanhoe also provides 1
year of operational consulting and training services, beginning on the signing date. These services have a value of $3,100. (Credit account titles are automatically indented
when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor
calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries. Record journal entries in the order
presented in the problem.)
Date
Account Titles and Explanation
Debit
Credit
= St
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Recommended textbooks for you
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
![Individual Income Taxes](https://www.bartleby.com/isbn_cover_images/9780357109731/9780357109731_smallCoverImage.gif)
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT