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33. On April 1, 20x4 Joy Grigsby, Inc. entered into a franchise agreement with a local business- man. The franchisee paid P240,000 and gave a P160,000, 8%. 3-year note payable with interest due annually on March 31. Joy Grigsby recorded the P400,000 initial franchise fee as revenue on April 1, 20x4. On December 30, 20x4, the franchisee decided not to open an outlet under Joy Grigsby's name. Joy Grigsby canceled the franchisee's note and refunded P128,000, less accrued interest on the note, of the P240,000 paid on April 1. What entry should Joy Grigsby make on December 30, 20x4 a. loss on Repossessed Franchise .. 128,000 Cash...... 128,000 b. Loss on Repossessed Franchise. 118,400 Cash ...... 118,400 C. Loss on Repossessed Franchise. 278,400 Cash ..... 118,400 Notes Receivable 160,000 d. Revenue from Franchise Fees. 400,000 Interest Income..... 9,600 Cash.... 118,400 Notes receivable ...... 160,000 112,000 Revenue from Repossessed Franchise