Homework Help is Here – Start Your Trial Now!
Business
Accounting
View Policies Current Attempt in Progress Crane Diners Inc. charges an initial franchise fee of $193000 broken down as follows: Rights to trade name, market area, and proprietary know-how $83000 Training services 37000 Equipment (cost of $34000) 73000 Total initial franchise fee $193000 Upon signing the agreement, a payment of $83000 is due. Thereafter, two annual payments of $53000 are required. The credit rating of the franchisee is such that it would have to pay interest of 8% to borrow money. The franchise agreement is signed on August 1, 2024, and the franchise commences operation on November 1, 2024. Assume that the total training fees include training services for the period leading up to the franchise opening ($20500 value) and for 3 months following opening. Crane Diners' journal entry on August 1, 2024 would include O a credit to Unearned Service Revenue for $37000. O a credit to Unearned Service Revenue for $16500. O a debit to Sales Revenue for $73000. O a debit to Unearned Franchise Revenue for $83000.

View Policies Current Attempt in Progress Crane Diners Inc. charges an initial franchise fee of $193000 broken down as follows: Rights to trade name, market area, and proprietary know-how $83000 Training services 37000 Equipment (cost of $34000) 73000 Total initial franchise fee $193000 Upon signing the agreement, a payment of $83000 is due. Thereafter, two annual payments of $53000 are required. The credit rating of the franchisee is such that it would have to pay interest of 8% to borrow money. The franchise agreement is signed on August 1, 2024, and the franchise commences operation on November 1, 2024. Assume that the total training fees include training services for the period leading up to the franchise opening ($20500 value) and for 3 months following opening. Crane Diners' journal entry on August 1, 2024 would include O a credit to Unearned Service Revenue for $37000. O a credit to Unearned Service Revenue for $16500. O a debit to Sales Revenue for $73000. O a debit to Unearned Franchise Revenue for $83000.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
None
View Policies Current Attempt in Progress Crane Diners Inc. charges an initial franchise fee of $193000 broken down as follows: Rights to trade name, market area, and proprietary know-how $83000 Training services 37000 Equipment (cost of $34000) 73000 Total initial franchise fee $193000 Upon signing the agreement, a payment of $83000 is due. Thereafter, two annual payments of $53000 are required. The credit rating of the franchisee is such that it would have to pay interest of 8% to borrow money. The franchise agreement is signed on August 1, 2024, and the franchise commences operation on November 1, 2024. Assume that the total training fees include training services for the period leading up to the franchise opening ($20500 value) and for 3 months following opening. Crane Diners' journal entry on August 1, 2024 would include O a credit to Unearned Service Revenue for $37000. O a credit to Unearned Service Revenue for $16500. O a debit to Sales Revenue for $73000. O a debit to Unearned Franchise Revenue for $83000.
Transcribed Image Text:View Policies Current Attempt in Progress Crane Diners Inc. charges an initial franchise fee of $193000 broken down as follows: Rights to trade name, market area, and proprietary know-how $83000 Training services 37000 Equipment (cost of $34000) 73000 Total initial franchise fee $193000 Upon signing the agreement, a payment of $83000 is due. Thereafter, two annual payments of $53000 are required. The credit rating of the franchisee is such that it would have to pay interest of 8% to borrow money. The franchise agreement is signed on August 1, 2024, and the franchise commences operation on November 1, 2024. Assume that the total training fees include training services for the period leading up to the franchise opening ($20500 value) and for 3 months following opening. Crane Diners' journal entry on August 1, 2024 would include O a credit to Unearned Service Revenue for $37000. O a credit to Unearned Service Revenue for $16500. O a debit to Sales Revenue for $73000. O a debit to Unearned Franchise Revenue for $83000.
Expert Solution
steps

Step by step

Solved in 3 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Revenue Recognition
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
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS