4. In 20X1, Liwanag Inc. began work on a four-year construction project (called Bright One). The contract price is P300 million. Liwanag uses the percentage of completion method of accounting. At the end of 20X, the following financial statement information indicate the results to date for Bright One. Income Statement: Gross profit recognized in 20X1 P22 million Balance Sheet: Accounts Receivable from construction billings P10 million Construction in Progress P66 million Less: Billings on Construction (75 million) Net billings in excess of construction in progress P 9 million Option 1 4.a Cash during 20X1 Your answer 4.b Actual costs incurred during 20X1. Your answer4.c On December 31, 20X1, the estimated remaining costs to complete. Your answer 4.d The percentage that was completed during 20X1. Your answer5. Hiboto Inc. sells franchises for an initial fee of P36.000 plus operating fees of P500 per month. The initial fee covers site selection, training, computer and accounting software, and on-site consulting, over the first five years. On March 15, 20X1, A franchisee signed a franchise contract, paying the standard P6.000 down with the balance due over 5 years with interest. Your answer 5.a Assuming that the initial services to be performed by Hiboto subsequent to the signing are substantial ad that collection of the receivable is reasonably assured, the journal entry required at signing would include a credit to Unearned Franchise Fee Revenue for Your answer 5.b Assume at the time of signing the contract, collection of the receivable was assured and that servie obligation were substantial. However, by October 20, 20X1, substantially all continuing obligations has been met. The journal entry required on October 20, 20X1 would include debit to Unearned Franchise Fee Revenue for5.c Assume at March 15, 20X1, the time of signing of the contract, collectability of the receivable was reasonably assured and there were no continuing obligations. The journal entry at the signing would include a credit to Franchise Fee Revenue for Your answer 6. Craftson Co., franchisor, entered into a franchise agreement with Thoso Inc., franchisee, on March 31, 20X1. The total franchise fee is P500,000, of which P100,00 is payable upon signing and the balance four equal annual installment. The down payment is refundable in the event the franchisor fails to render services and none thus far had been rendered. When Craftson prepares its financial statements on March 31, 20X1. The franchise fee to be reported is Your