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Problem 9: On January 1, 20x1, Chicago Inc. granted a franchise right to a franchisee for the operation of coffee shop using Chicago's trade name for a period of 10 years starting January 1, 20x1. The franchise is required to pay nonrefundable Initial franchise fee of P10M and continuing franchise fee of 10% of franchisee's annual sales. It is the obligation of Chicago to construct the coffee shop and to deliver the movables. In addition to that, Chicago has the obligation to deliver 100,000 units of raw materials to the franchisee. The stand-alone selling price of the right to use Chicago's trade name is P4M. The stand-alone selling price of the construction of the coffee shop and delivery of movables is P3M while the stand along selling price of the 100,000 units of raw materials is PIM. On July 1, 20x1, Boston finished the construction of the coffee shop and delivered all the required movables. 20,000 units of raw materials have been delivered as of December 31, 20x1. The franchisee reported sales revenue amounting to P2M for the year 20x1. What is the amount of total revenue to be reported by Boston Inc. for the year ended December 31, 20x17 a. P10,000,000 6. P4,700,000 C. PB,750,000 d. P5,700,000