{ "key_pair_value_system": true, "answer_rating_count": "", "question_feedback_html": { "html_star": "", "html_star_feedback": "" }, "answer_average_rating_value": "", "answer_date_js": "2024-06-29T01:24:38-04:00", "answer_date": "2024-06-29 01:24:38", "is_docs_available": null, "is_excel_available": null, "is_pdf_available": null, "count_file_available": 0, "main_page": "student_question_view", "question_id": "4438267", "url": "\/study-help\/questions\/1-bigbang-operates-and-franchises-restaurants-around-the-world-as-4438267", "question_creation_date_js": "2024-06-29T01:24:38-04:00", "question_creation_date": "Jun 29, 2024 01:24 AM", "meta_title": "[Solved] 1. BIGBANG operates and franchises restau | SolutionInn", "meta_description": "Answer of - 1. BIGBANG operates and franchises restaurants around the world. As part of its franchise agreement, BIGBANG requires | SolutionInn", "meta_keywords": "1,bigbang,operates,franchises,restaurants,world,part,franchise,agreement,requires,franchisee,pay", "question_title_h1": "1. BIGBANG operates and franchises restaurants around the world. As part of its franchise agreement, BIGBANG requires a franchisee to pay a non-refundable upfront franchise", "question_title": "1. BIGBANG operates and franchises restaurants around the world. As part of", "question_title_for_js_snippet": "1 BIGBANG operates and franchises restaurants around the world As part of its franchise agreement, BIGBANG requires a franchisee to pay a non refundable upfront franchise fee of P9,500,000 upon opening a restaurant and ongoing payments of royalties, based on percentage of sales As part of the franchise agreement, BIGBANG provides pre opening services, including supply and installation of cooking equipment and cash register, valued at P2,500,000 (i e , the stand alone selling price of the pre operating services) In addition, the franchise agreement includes a license of intellectual property (i e , BIGBANG's trademark and trade name) to the franchisee Assume that BIGBANG has determined that the license provides a right to access the intellectual property BIGBANG has determined the stand alone selling price of the license is P7,500,000 The franchise agreement has a term of 15 years BIGBANG evaluates the arrangement and determines it meets the criteria to be accounted for as a contract with a customer BIGBANG determines its pre opening services and license of intellectual property (IP) are each distinct and, therefore, need to be accounted for as separate performance obligations (PO) How much should BIGBANG recognize as revenue from licensed IP in year 1 2 A home office ships merchandise to the branch at 30 above cost The allowance for overvaluation at the beginning of the year was P24,000 and at the end of the year, the balance before adjustment was P264,000, and after the adjustment, the balance is P27,000 How much is the shipment to branch account during the year 3 Integrity Company entered into a licensing agreement with a private company for a drug under development Integrity will receive a payment of P5,000,000 if the drug receives a regulatory approval Based on prior experience in the drug approval process, Integrity determines that it is 90 likely that the drug will gain approval and a 10 chance of denial How much is the Transaction Price ", "question_description": "

1. BIGBANG operates and franchises restaurants around the world. As part of its franchise agreement, BIGBANG requires a franchisee to pay a non-refundable upfront franchise fee of P9,500,000 upon opening a restaurant and ongoing payments of royalties, based on percentage of sales. As part of the franchise agreement, BIGBANG provides pre-opening services, including supply and installation of cooking equipment and cash register, valued at P2,500,000 (i.e., the stand-alone selling price of the pre-operating services). In addition, the franchise agreement includes a license of intellectual property (i.e., BIGBANG's trademark and trade name) to the franchisee. Assume that BIGBANG has determined that the license provides a right to access the intellectual property. BIGBANG has determined the stand-alone selling price of the license is P7,500,000. The franchise agreement has a term of 15 years. BIGBANG evaluates the arrangement and determines it meets the criteria to be accounted for as a contract with a customer. BIGBANG determines its pre-opening services and license of intellectual property (IP) are each distinct and, therefore, need to be accounted for as separate performance obligations (PO). How much should BIGBANG recognize as revenue from licensed IP in year 1?<\/strong><\/em><\/p>

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2. A home office ships merchandise to the branch at 30% above cost. The allowance for overvaluation at the beginning of the year was P24,000 and at the end of the year, the balance before adjustment was P264,000, and after the adjustment, the balance is P27,000. How much is the shipment to branch account during the year?<\/p>

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3. Integrity Company entered into a licensing agreement with a private company for a drug under development. Integrity will receive a payment of P5,000,000 if the drug receives a regulatory approval. Based on prior experience in the drug-approval process, Integrity determines that it is 90% likely that the drug will gain approval and a 10% chance of denial. How much is the Transaction Price?<\/strong><\/em><\/p>

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<\/p>", "transcribed_text": "", "related_book": { "title": "Intermediate Accounting", "isbn": "470964731, 978-0470964736, 978-0470161012", "edition": "9th Canadian Edition, Volume 2", "authors": "Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield.", "cover_image": "https:\/\/dsd5zvtm8ll6.cloudfront.net\/si.question.images\/book_images\/516.jpg", "uri": "\/textbooks\/intermediate-accounting-9th-canadian-edition-volume-2-516", "see_more_uri": "" }, "free_related_book": { "isbn": "0593087682", "uri": "\/textbooks\/trillions-how-a-band-of-wall-street-renegades-invented-the-index-fund-and-changed-finance-forever-1st-edition-9780593087688-9780593087695", "name": "Trillions How A Band Of Wall Street Renegades Invented The Index Fund And Changed Finance Forever", "edition": "1st Edition" }, "question_posted": "2024-06-29 01:24:38", "see_more_questions_link": "\/study-help\/questions\/business-human-resource-management-2020-May-22", "step_by_step_answer": "The Answer is in the image, click to view ...", "students_also_viewed": [ { "url": "\/as-a-lecture-demonstration-a-short-cylindrical-bar-magnet-is", "description": "As a lecture demonstration a short cylindrical bar magnet is dropped down a vertical aluminum pipe of slightly larger diameter, about 2 meters long. 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