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Assume That at the Time of Signing the Contract, Collection

Question 69

Multiple Choice

Assume that at the time of signing the contract, collection of the receivable was assured and that service obligations were substantial. However, by October 20, 2008, substantially all continuing obligations had been met. The journal entry required at October 20, 2008 would include a:


A) Credit to franchise fee receivable for $27,000.
B) Debit to unearned franchise fee revenue for $36,000.
C) Credit to franchise fee revenue for $9,000.
D) Debit to unearned franchise fee revenue for $27,000.

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