Use the following information for the next four questions: contract with Sheldon J. Plankton Co. to transfer a license for a On December 31, 20x1, Mr. Eugene H. Krabs Co. enters into a fixed fee of P100,000 payable as follows: 80% in 4 equal annual installments starting December 31, 20x2. 20% upon signing of contract. The appropriate discount rate is 12%. ● of 4. The license provides Plankton rights over Mr. Krabs' patented secret formula for a burger patty. Plankton continues to operate using its trade name and has the discretion developing a new product name for the products it will produce using the secret formula. The license does not explicitly require Mr. Krabs to undertake activities that will significantly affect the intellectual property to which Plankton has rights. Neither does Plankton expect that Mr. Krabs will undertake such activities. Mr. Krabs provides the secret formula to Plankton on December 31, 20x1. How much contract revenue will Krabs recognize in 20x1? c. 80,747 d. 0 a. 60,747 b. 79,132 5. The license provides Plankton rights over Mr. Krabs' patented secret formula for a burger patty. The agreement requires Plankton to discontinue using its trade name and instead use Mr. Krabs trade name for a period of four years. Plankton is bound by the terms of the contract to abide with Mr. Krabs' policies on the use of the secret formula but is given the right to any subsequent modifications to the secret formula. Mr. Krabs provides the secret formula to Plankton on December 31, 20x1. How much contract revenue will Krabs recognize in 20x1? a. 20,187 - 60,747 c. 80,747
Use the following information for the next four questions: contract with Sheldon J. Plankton Co. to transfer a license for a On December 31, 20x1, Mr. Eugene H. Krabs Co. enters into a fixed fee of P100,000 payable as follows: 80% in 4 equal annual installments starting December 31, 20x2. 20% upon signing of contract. The appropriate discount rate is 12%. ● of 4. The license provides Plankton rights over Mr. Krabs' patented secret formula for a burger patty. Plankton continues to operate using its trade name and has the discretion developing a new product name for the products it will produce using the secret formula. The license does not explicitly require Mr. Krabs to undertake activities that will significantly affect the intellectual property to which Plankton has rights. Neither does Plankton expect that Mr. Krabs will undertake such activities. Mr. Krabs provides the secret formula to Plankton on December 31, 20x1. How much contract revenue will Krabs recognize in 20x1? c. 80,747 d. 0 a. 60,747 b. 79,132 5. The license provides Plankton rights over Mr. Krabs' patented secret formula for a burger patty. The agreement requires Plankton to discontinue using its trade name and instead use Mr. Krabs trade name for a period of four years. Plankton is bound by the terms of the contract to abide with Mr. Krabs' policies on the use of the secret formula but is given the right to any subsequent modifications to the secret formula. Mr. Krabs provides the secret formula to Plankton on December 31, 20x1. How much contract revenue will Krabs recognize in 20x1? a. 20,187 - 60,747 c. 80,747
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please answer only the number 6. Thank you!
Transcribed Image Text:Use the following information for the next four questions:
On December 31, 20x1, Mr. Eugene H. Krabs Co. enters into a
I contract with Sheldon J. Plankton Co. to transfer a license for a
fixed fee of P100,000 payable as follows:
80% in 4 equal annual installments starting December 31, 20x2,
20% upon signing of contract.
The appropriate discount rate is 12%.
4. The license provides Plankton rights over Mr. Krabs' patented
secret formula for a burger patty. Plankton continues to
operate using its trade name and has the discretion of
produce using the secret formula. The license does not
developing a new product name for the products it will
explicitly require Mr. Krabs to undertake activities that will
significantly affect the intellectual property to which Plankton
has rights. Neither does Plankton expect that Mr. Krabs will
undertake such activities. Mr. Krabs provides the secret
formula to Plankton on December 31, 20x1. How much
contract revenue will Krabs recognize in 20x1?
c. 80,747
d. 0
a. 60,747
b. 79,132
5. The license provides Plankton rights over Mr. Krabs' patented
secret formula for a burger patty. The agreement requires
Plankton to discontinue using its trade name and instead use
Mr. Krabs trade name for a period of four years. Plankton is
bound by the terms of the contract to abide with Mr. Krabs'
policies on the use of the secret formula but is given the right
to any subsequent modifications to the secret formula. Mr.
Krabs provides the secret formula to Plankton on December
31, 20x1. How much contract revenue will Krabs recognize in
20x1?
a. 20,187
b. 60,747
L
c. 80,747
d. 0
Transcribed Image Text:6. Using the information in the immediately following item, how
much total revenue will Krabs recognize in 20x2?
a. 20,187
b. 27,477
c. 80,747
d. 0
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