Reference no: EM132943165

Problem 1: Granting the exclusive right or privilege to another party for the performance of certain functions by the grantor or use of certain products and services is:

A. patent

B. goodwill

C. franchise

D. copyright

Problem 2: If the initial fee is collectible over an extended period and there is a significant uncertainty of its collection in full, the fee is:

A. recognized as revenue in full

B. recognized as revenue when collected

C. not recognized as revenue at all.

D. deferred of recognition as revenue

Problem 3: When the franchisor supplies equipments and inventories without a reasonable profit, part of the initial franchise fee, sufficient to cover the estimated costs in excess of that price is:

A. deferred and recognized over the period the goods are likely to be sold to the franchisee

B. not recognized.

C. deferred and recognized when finally sold to the franchisee

D. recognized immediately

Problem 4: If the Construction in Progress account is greater than the Contract Billings, the excess is treated as:

A. loss

B. current liability

C. income

D. current asset