Franchise contracts are complex contractual arrangements with many parts.
Instructions
Writing Assignments 369 Access the Accounting Guideline (AcG) 2 Franchise Fee Revenue from the Canadian Institute of Chartered Accountants Standards and Guidance Collection, Accounting Handbook, Accounting Guidelines. (This guideline can be accessed through Knotia, available through your school's library database.) Answer the following questions.
(a) What is a franchise?
(b) Using the information provided in the guideline, compare the accounting guidance given in this guideline for reporting and measuring the franchisee fee revenue with the general principles for revenue recognition. Address each issue separately, highlighting similarities and differences between the guidance and application of the general revenue principles.