Franchises RUs Corp. (FRU) is a franchisor that owns the rights to Mega Foods (MF). FRU sells MF franchises to the franchisees. The initial franchise package includes the required equipment and training to use it. FRU provides sales and marketing services and operational support to its franchisees on an ongoing basis. The fees for sales and marketing services are based on the annual sales revenue generated by the franchisee. FRU prepares its financial results in accordance with IFRS. The company only prepares adjusting entries and accruals at year end, which is December 31. On January 1, Year 1, FRU sold an MF franchise to New Operators Corp. (NOC). Details of this transaction are as follows: The franchise agreement entitles NOC to operate an MF outlet for six years (January 1, Year 1, to December 31, Year 6). NOC was required to pay an initial fee of $380,000 cash on January 1, Year 1, and six annual payments of $50,000 due on December 31 each year, with the first payment due on December 31, Year 1. On January 1, Year 1, FRU delivered the equipment to NOC and provided the required training. The franchise equipment is unique and cannot be used without training, which only the franchisor can provide. The fair market value (stand-alone selling price) of the equipment and training was $475,000. FRU does not offer operational support on a stand-alone basis. FRUs normal costs of providing these services are $20,000 per year. FRUs usual markup on costs for similar services that it provides is 30%. FRU determined that a 6% discount rate appropriately reflects NOCs underlying credit risk. FRUs weighted average cost of capital is 5.5%. FRU determined that the provision of the equipment and training, the operational support, and the sales and marketing services are each distinct performance obligations.

Required: Determine what amount of the initial transaction price will be allocated to revenue for the equipment sales and training performance obligation. Need working notes as well