On December 31, 2019, Entity A enters into a contract with Customer B to transfer a license for a fixed fee of P100,000 payable as follows: • 20% is payable upon signing of contract. • 80% is represented by a note receivable collectible in 4 equal annual installments starting December 31, 2020. The appropriate discount rate is 12% (Use PV facto = 3.0375) The license provides Customer B the right to use Entity A's patented processes. Customer B continues to operate using its trade name and has the discretion of developing a new product name for the products it will produce

On December 31, 2019, Entity A enters into a contract with Customer B to transfer a license for a fixed fee of P100,000 payable as follows: • 20% is payable upon signing of contract. • 80% is represented by a note receivable collectible in 4 equal annual installments starting December 31, 2020. The appropriate discount rate is 12% (Use PV facto = 3.0375) The license provides Customer B the right to use Entity A's patented processes. Customer B continues to operate using its trade name and has the discretion of developing a new product name for the products it will produce

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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