Juliet Mindanao Technologies licenses its intellectual property to Francis Bautista industries. Terms of the arrangement require Francis Bautista to pay Juliet Mindanao P500,000 an April 1, 20x4 when Francis Bautista first obtains access to Juliet Mindanao's intellectual property, and then to pay Julet Mindanao a royalty of 4% of future sales of products that utilize that intellectual property, Juliet Mindanao anticipates receiving sales-based royalties of P1,000,000 during 20x4 and P1.500.000/year for the years 20x5-20x9. Assume Juliet Mindanao accounts for the Francis Bautista license as a right of use, because Juliet Mindanao's actions subsequent to April 1, 20x4 will affect the benefits that Francis Bautista receives from access to Jullet Mindanao's intellectual property. 1. Identify the specific citation for accounting for variable consideration arising from sales based royallies on icenses of intellectual property, and consider the relevant GAAP When can Juliet recognize revenue from sales-based royalties associated with the Francis Bautista license?
Juliet Mindanao Technologies licenses its intellectual property to Francis Bautista industries. Terms of the arrangement require Francis Bautista to pay Juliet Mindanao P500,000 an April 1, 20x4 when Francis Bautista first obtains access to Juliet Mindanao's intellectual property, and then to pay Julet Mindanao a royalty of 4% of future sales of products that utilize that intellectual property, Juliet Mindanao anticipates receiving sales-based royalties of P1,000,000 during 20x4 and P1.500.000/year for the years 20x5-20x9. Assume Juliet Mindanao accounts for the Francis Bautista license as a right of use, because Juliet Mindanao's actions subsequent to April 1, 20x4 will affect the benefits that Francis Bautista receives from access to Jullet Mindanao's intellectual property.
1. Identify the specific citation for accounting for variable consideration arising from sales based royallies on icenses of intellectual property, and consider the relevant GAAP When can Juliet recognize revenue from sales-based royalties associated with the Francis Bautista license?
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