Cyan Company Signs a 13-Year Franchise Agreement with Fast Taco

Cyan Company signs a 13-year franchise agreement with Fast Taco.Fast Taco retained significant powers,rights,and a continuing interest.Cyan Company (the franchisee) makes noncontingent payments of $17,000 per year for the first five years of the franchise.Cyan Company also pays a contingent fee of 1% of gross sales every month.Which of the following statements is correct?

A) Cyan Company may deduct the $17,000 per year noncontingent payments in full as they are made.
B) Cyan Company may deduct the monthly contingent fee as it is paid.
C) Cyan Company may deduct both the noncontingent annual fee and the contingent monthly fees as they are paid.
D) Cyan Company may not deduct either the noncontingent annual fee or the contingent monthly fees as they are paid.
E) None of the above.