In 2020, BTS Corp. sold a layout design to Jungkook Inc. and will receive royalties of 20% of future revenues associated with the said design. On December 31, 2020, BTS Designs reported royalty receivable of P75,000 from Jungkook Inc. During 2021, BTS Design received a royalty payment of P200,000. Jungkook Inc. reported revenues of P1,500,000 in 2021 from the layout design. In the 2021 income statement, what should BTS Designs report as royalty revenue?
In 2020, BTS Corp. sold a layout design to Jungkook Inc. and will receive royalties of 20% of future revenues associated with the said design. On December 31, 2020, BTS Designs reported royalty receivable of P75,000 from Jungkook Inc. During 2021, BTS Design received a royalty payment of P200,000. Jungkook Inc. reported revenues of P1,500,000 in 2021 from the layout design. In the 2021 income statement, what should BTS Designs report as royalty revenue?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In 2020, BTS Corp. sold a layout design to Jungkook Inc. and will receive royalties of 20% of future revenues associated with the said design. On December 31, 2020, BTS Designs reported royalty receivable of P75,000 from Jungkook Inc. During 2021, BTS Design received a royalty payment of P200,000. Jungkook Inc. reported revenues of P1,500,000 in 2021 from the layout design. In the 2021 income statement, what should BTS Designs report as royalty revenue?
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