Assume the same facts as in BE 5-22 except that the trade name Saar Associates is not
Question:
Assume the same facts as in BE 5-22 except that the trade name "Saar Associates" is not well known in the marketplace and the owner provides no advertising or other benefits to a licensee of the Saar Associates trade name during the license period. How much revenue will Saar recognize in 2018 under this arrangement if Saar reports under U.S. GAAP?
In BE5-22
Saar Associates sells two licenses to Kim & Company on September 1, 2018. First, in exchange for $100,000, Saar provides Kim with a copy of its proprietary investment management software, which Saar does not anticipate updating and which Kim can use permanently. Second, in exchange for $90,000, Saar provides Kim with a three-year right to market Kim's financial advisory services under the name of Saar Associates, which Saar advertises on an ongoing basis.
Step by Step Answer:
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas