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  3. Study Set
    Intermediate Accounting Reporting and Analysis
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    Exam 17: Advanced Issues in Revenue Recognition
  5. Question
    Under GAAP, the Franchisor Recognizes the Initial Franchise Fee as Revenue
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Under GAAP, the Franchisor Recognizes the Initial Franchise Fee as Revenue

Question 1

Question 1

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Under GAAP, the franchisor recognizes the initial franchise fee as revenue when it has substantially performed all material services. What does substantial performance mean?

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