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How much is the total profit recognized from the three contracts in 20x1? How much is the total profit recognized from the three contracts on
How much is the total profit recognized from the three contracts in 20x1?
How much is the total profit recognized from the three contracts on July 1, 20x1: Present value of Franchisee Totals Water Co. enters into the following three franchise agreements The nature of the licenses is to provide the customers the 'right to use Water's intellectual property as it exists at grant date. Water transfers the licenses to the customers on Cash Probability of Direct down collection costs payment note incurred Reasonably assured 20,000 60,747 32,000 B Uncertain 20,000 48,037 25,000 C Significantly uncertain 20,000 33,801 21,520 60,000 142,585 78,520 Additional information: The down payments are non-refundable and are due at contract inception. The discount rate on all the notes is 12% and the first installment payments are due on July 1, 20x2. At contract inception, Water expects to provide Franchisee B a price concession and concludes that it is probable that Franchisee B will pay half of the note. The adjusted present value of the note is P24,018. The discount rate is 12%. July 1, 20x1. in 20x1? a. -74,879 b. 76,982 c. 78,312 d. 80,921Step by Step Solution
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