On January 1, 2022, Entity A granted a franchise right to franchisee for the operation of...

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On January 1, 2022, Entity A granted a franchise right to franchisee for the operation of selling automobile parts. Entity A also granted the franchisee the right to access its trade name for a period of 10 years. The franchisee is required to pay an upfront non- refundable initial franchise fee of P20,000,000 and a continuing franchise fee of 10% of the annual sales. It is the obligation of Entity A to construct the franchise stall and to deliver 10,000 units of automobile parts to the franchisee. Stand-alone selling prices Trade-name P4,000,000 Construction of the stall P3,000,000 Delivery of 10,000 units of automobile parts Not directly observable After careful evaluation of the market, the price that a customer is willing to pay for the delivery of 10,000 units of materials was P1,000,000 under the adjusted market assessment approach. On October 1, 2022, Entity already finished the construction of the stall and as of December 31, 2022, Entity A only delivered 2,000 units of automobile parts. The franchisee reported sales revenue December 31, 2022, in the amount of P4,000,000. on 1. Under IFRS 15, what is the revenue recognized pertaining to the delivery of automobile parts? a. 2,500,000 b. 312,500 c.0 d. 500,000 2. Under IFRS 15, what is the total revenue from the initial franchise fee? a. 9,000,000 b. 9,400,000 c. 11,000,000 d. 11,400,000 On January 1, 2022, Entity A granted a franchise right to franchisee for the operation of selling automobile parts. Entity A also granted the franchisee the right to access its trade name for a period of 10 years. The franchisee is required to pay an upfront non- refundable initial franchise fee of P20,000,000 and a continuing franchise fee of 10% of the annual sales. It is the obligation of Entity A to construct the franchise stall and to deliver 10,000 units of automobile parts to the franchisee. Stand-alone selling prices Trade-name P4,000,000 Construction of the stall P3,000,000 Delivery of 10,000 units of automobile parts Not directly observable After careful evaluation of the market, the price that a customer is willing to pay for the delivery of 10,000 units of materials was P1,000,000 under the adjusted market assessment approach. On October 1, 2022, Entity already finished the construction of the stall and as of December 31, 2022, Entity A only delivered 2,000 units of automobile parts. The franchisee reported sales revenue December 31, 2022, in the amount of P4,000,000. on 1. Under IFRS 15, what is the revenue recognized pertaining to the delivery of automobile parts? a. 2,500,000 b. 312,500 c.0 d. 500,000 2. Under IFRS 15, what is the total revenue from the initial franchise fee? a. 9,000,000 b. 9,400,000 c. 11,000,000 d. 11,400,000