ABC Franchisor entered into a franchise contract that will allow the franchisee to use ABC's copyright over a video. The contract is applicable for a period of 5 years. The transaction price is P100,00 cash to be paid on the date of grant. What is the journal entry to recognize the transaction price? [A] DR: Cash 100,000; CR: Franchise Revenue [B] DR: Cash - 100,000; CR: Contract Liability [C] DR: Contract Asset - 100,000; CR: Franchise Revenue [D] DR: Contract Asset – 100,000; CR: Contract Liability -
ABC Franchisor entered into a franchise contract that will allow the franchisee to use ABC's copyright over a video. The contract is applicable for a period of 5 years. The transaction price is P100,00 cash to be paid on the date of grant. What is the journal entry to recognize the transaction price? [A] DR: Cash 100,000; CR: Franchise Revenue [B] DR: Cash - 100,000; CR: Contract Liability [C] DR: Contract Asset - 100,000; CR: Franchise Revenue [D] DR: Contract Asset – 100,000; CR: Contract Liability -
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![ABC Franchisor entered into a franchise contract that will
allow the franchisee to use ABC's copyright over a video.
The contract is applicable for a period of 5 years. The
transaction price is P100,00 cash to be paid on the date of
grant. What is the journal entry to recognize the transaction
price?
[A] DR: Cash 100,000; CR: Franchise Revenue
[B] DR: Cash - 100,000; CR: Contract Liability
[C] DR: Contract Asset – 100,000; CR: Franchise
Revenue
[D] DR: Contract Asset – 100,000; CR: Contract Liability](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F925dba2e-5496-4bec-824d-e314c61db5bd%2Ffa4aa71a-28b0-4a99-81bf-a4730c4b1389%2Fdx6yo54_processed.jpeg&w=3840&q=75)
Transcribed Image Text:ABC Franchisor entered into a franchise contract that will
allow the franchisee to use ABC's copyright over a video.
The contract is applicable for a period of 5 years. The
transaction price is P100,00 cash to be paid on the date of
grant. What is the journal entry to recognize the transaction
price?
[A] DR: Cash 100,000; CR: Franchise Revenue
[B] DR: Cash - 100,000; CR: Contract Liability
[C] DR: Contract Asset – 100,000; CR: Franchise
Revenue
[D] DR: Contract Asset – 100,000; CR: Contract Liability
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education