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ah: n Duallltu; *E'I-ZBB [LOB] (Franchise Entries} Burger Universe charges an initial franchise fee of $225M. Upon the signing of the agreement, a payment
\ ah: n Duallltu; *E'I-ZBB [LOB] (Franchise Entries} Burger Universe charges an initial franchise fee of $225M. Upon the signing of the agreement, a payment of $25,111] is due. Thereafter, five annual payments of $40,000 are required. The credit rating of the fran chisee is such that it would have to pay interest at 12% to borrow money. The franchise agreement is signed on August 1, 201?, and the franchise commences operation on October 1, 201?. Instructions Plepare the journal entries in 2017 for the franchisor under lire following assumptions. (Round to the nearest dollar.) {a} No future services are required by the franchisor once the franchise starts operations. l[bl The franchisor has substantial services to perform, once the franchise begins operations, to maintain the value of the franchise. {c} The total franchise fee includes training services {with a value of$?,5m:l for the period leading up to the franchise open ing and for 2 months following opening
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