On January 1, 2025, Sharon Walker signed an agreement, covering 5 years, to operate as a...

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On January 1, 2025, Sharon Walker signed an agreement, covering 5 years, to operate as a franchisee of Carla Vista Inc. for an initial franchise fee of $62,000. The amount of $9,000 was paid when the agreement was signed, and the balance is payable in five annual payments of $10,600 each, beginning January 1, 2026. The agreement provides that the down payment is nonrefundable and that no future services are required of the franchisor once the franchise commences operations on April 1, 2025. Sharon Walker's credit rating indicates that she can borrow money at 9% for a loan of this type. Click here to view the factor table. (a) Your answer is partially correct. Prepare journal entries for Carla Vista for 2025-related revenue for this franchise arrangement. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries.) Date Account Titles and Explanation Debit Cred Jan. 1, 2025 Cash Notes Receivable Discount on Notes Receivable Unearned Franchise Revenue Apr. 1, 2025 Unearned Franchise Revenue Franchise Revenue 9000 53000 Dec. 31, 2025 Discount on Notes Receivable 3400 Interest Revenue On January 1, 2025, Sharon Walker signed an agreement, covering 5 years, to operate as a franchisee of Carla Vista Inc. for an initial franchise fee of $62,000. The amount of $9,000 was paid when the agreement was signed, and the balance is payable in five annual payments of $10,600 each, beginning January 1, 2026. The agreement provides that the down payment is nonrefundable and that no future services are required of the franchisor once the franchise commences operations on April 1, 2025. Sharon Walker's credit rating indicates that she can borrow money at 9% for a loan of this type. Click here to view the factor table. (a) Your answer is partially correct. Prepare journal entries for Carla Vista for 2025-related revenue for this franchise arrangement. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List all debit entries before credit entries.) Date Account Titles and Explanation Debit Cred Jan. 1, 2025 Cash Notes Receivable Discount on Notes Receivable Unearned Franchise Revenue Apr. 1, 2025 Unearned Franchise Revenue Franchise Revenue 9000 53000 Dec. 31, 2025 Discount on Notes Receivable 3400 Interest Revenue