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Question - Metlock Delight, Inc. charges an initial franchise fee of $75,800 for the right to operate as a franchisee of Metlock Delight. Of this amount, $24,700 is collected immediately. The remainder is collected in four equal annual installments $12,775 each. These installments have a present value of $41,636. As part of the total franchise fee, Metlock Delight also provides training (with a fair value of $2,000) to help franchisees get the store ready to open. The franchise agreement is signed on April 1, 2017, training is completed, and the store opens on July 1, 2017. Prepare the journal entry required by Metlock Delight in 2017.
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