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3. Beefeater Inc. sells fast-food franchises. Beefeater receives $75,000 from a new franchisee for providing initial...

3. Beefeater Inc. sells fast-food franchises. Beefeater receives $75,000 from a new franchisee for providing initial training, equipment, and furnishings that together have a stand-alone selling price of $75,000. Beefeater also receives $36,000 per year for use of the Beefeater name and for ongoing consulting services (starting on the date the franchise is purchased). Seagram became a Beefeater franchisee on March 1, 2020, and on May 1, 2020 Seagram had completed training and was open for business. How much revenue in 2020 will Beefeater recognize for its arrangement with Seagram?

A)$75,000

B) $99,000

C) $105,000

D)$111,000

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Answer #1

Solutions Given data, Selling price Receives $15000 $36000 per year. The revenue to be recognized for the year 2020 is = Init

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