Ivonne enters into a contract for 2 years with Irvin to transfer a license. The agreement signed on January 2, 2025, called for a P30,000 down payment plus a 10% interest bearing note of P20.000 payable in two annual payments starting December 31, 2025. The license provides that Irvin has the right to use the secret formula to produce healthy juice. The license does not explicitly require Ivonne to undertake activities that will significantly affect the secret formula to which Irvin has rights. The collectability of the note is reasonably assured.
What is the total revenue to be recognized on December 31, 2025?
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Assume that the license provides Irvin the right to access the secret formula to produce healthy juice. Irvin is bound by the terms of the contract to follow the policies on the use of the secret formula by Ivonne but is given the right to any subsequent modifications to the secret formula. What is the total revenue to be recognized on
December 31, 2025?
[Select]
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25,000
21,000
27,000
50,000