Franchise fees should be recognized
A)on the date the contract was signed.
B)on the date the franchise is opened for business.
C)on the date the franchise fee is paid to franchisor.
D)when performance obligations are satisfied.

Question

Quizplus · Accepted Answer

Franchise fees should be recognized when performance obligations are satisfied, in accordance with revenue recognition principles. This means recognizing revenue when the franchisor has fulfilled its obligations under the franchise agreement.

Franchise Fees Should Be Recognized