Required information [The following information applies to the questions displayed below.] A local theater company sells 1,500 season ticket packages at a price of $250 per package. The first show in the 10-show season starts this week. (a) The sale of the season tickets before the first show. (b) The revenue from fulfilling the performance obligation by putting on the first show. 1. Indicate the effects of the amounts for the above transactions. (Enter any decreases to assets, liabilities, or stockholders equity with a minus sign.)

Required information [The following information applies to the questions displayed below.] A local theater company sells 1,500 season ticket packages at a price of $250 per package. The first show in the 10-show season starts this week. (a) The sale of the season tickets before the first show. (b) The revenue from fulfilling the performance obligation by putting on the first show. 1. Indicate the effects of the amounts for the above transactions. (Enter any decreases to assets, liabilities, or stockholders equity with a minus sign.)

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter8: Revenue Recognition, Receivables, And Advances From Customers

Section: Chapter Questions

Problem 48P

See similar textbooks

Similar questions

Required information Skip to question [The following information applies to the questions displayed below.] A local theater company sells 1,700 season ticket packages at a price of $300 per package. The first show in the 10-show season starts this week. (a) The sale of the season tickets before the first show. (b) The revenue from fulfilling the performance obligation by putting on the first show. Indicate the effects of the amounts for the above transactions. (Enter any decreases to assets, liabilities, or stockholders equity with a minus sign.)
Required information Skip to question [The following information applies to the questions displayed below.] A local theater company sells 1,700 season ticket packages at a price of $300 per package. The first show in the 10-show season starts this week. (a) The sale of the season tickets before the first show. (b) The revenue from fulfilling the performance obligation by putting on the first show. Prepare the journal entries related for the above transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
PRACTICE PROBLEM Listed below are selected transactions of Scultz Department Store for the current year ending December 31. On December 5, the store received $500 from the Jackson Players as a deposit to be returned after certain furniture to be used in stage production was returned on January 15. During December, cash sales totaled $798,000, which includes the 5% sales tax that must be remitted to the state by the fifteenth day of the following month. On December 10, the store purchased for cash three delivery trucks for $120,000. The trucks were purchased in a state that applies a 5% sales tax. The store determined it will cost $100,000 to restore the area (considered a land improvement) surrounding one of its store parking lots, when the store is closed in 2 years. Schultz’ estimates the fair value of the obligation at December 31 is $84,000. As a result of uninsured accidents during the year, personal injury suits for $350,000 and $60,000 have been filed against the…
A local theater company sells 1,500 season ticket packages at a price of $250 per package. The firstshow in the ten-show season starts this week. Show the accounting equation effects and prepare thejournal entries related to ( a ) the sale of the season tickets before the first show and ( b ) the revenueearned after putting on the first show.
Allee Corp. is evaluating a revenue arrangement to determine proper revenue recognition. The contract is for construction of 10 speedboats for a contract price of $400,000. The customer needs the boats in its showrooms by February 1, 2018, for the boat purchase season; thecustomer provides a bonus payment of $21,000 if all boats are delivered by the February 1 deadline. The bonus is reduced by $7,000 each week that the boats are delivered after the deadline until no bonus is paid if the boats are delivered after February 15, 2018. Allee frequently includes such bonus terms in it contracts and thus has good historical data for estimating the probabilities of completion at different dates. It estimates an equal probability (25%) for each full delivery outcome. What approach should Allee use to determine the transaction price for this contract? Explain.
The Cougars football team sells season tickets in advance for $480 each. The season consists of 16 games. Half of these games are home games, and half of them are away games. For Year 3, the team has sold and collected payment for 10,000 season tickets. Through November 30, Year 3, six home games and five away games have been played. How much of the revenue collected in advance should be recognized on the income statement for the 11 months ended November 30, Year 3?
Cobra Company sells appliance service contracts agreeing to repair appliances for a three-year period. The past experience is that the total amount spent for repairs on service contracts, 40% is incurred evenly during the first contract year, 25% is incurred evenly during the second contract year and 35% is incurred evenly during the 3rd contract year. Receipts from service contract sales are P500,000 for 2020 and P600,000 for 2021. How much is the balance of unearned revenue pertaining to 2020 sales as of December 2021?
Allee Corp. is evaluating a revenue arrangement todetermine proper revenue recognition. The contract is forconstruction of 10 speedboats for a contract price of$400,000. The customer needs the boats in its showroomsby February 1, 2018, for the boat purchase season; thecustomer provides a bonus payment of $21,000 if allboats are delivered by the February 1 deadline. The bonusis reduced by $7,000 each week that the boats are deliveredafter the deadline until no bonus is paid if the boatsare delivered after February 15, 2018. Allee frequentlyincludes such bonus terms in it contracts and thus hasgood historical data for estimating the probabilities ofcompletion at different dates. It estimates an equal probability(25%) for each full delivery outcome. Assume thatAllee has limited experience with a construction projecton the same scale as the 10 speedboats. How does thisaffect the accounting for the variable consideration?
. Allee Corp. is evaluating a revenue arrangement to determine proper revenue recognition. The contract is for construction of 10 speedboats for a contract price of $400,000. The customer needs the boats in its showrooms by February 1, 2021, for the boat purchase season; the customer provides a bonus payment of $21,000 if all boats are delivered by the February 1 deadline. The bonus is reduced by $7,000 each week that the boats are delivered after the deadline until no bonus is paid if the boats are delivered after February 15, 2021. Allee frequently includes such bonus terms in it contracts and thus has good historical data for estimating the probabilities of completion at different dates. It estimates an equal probability (25%) for each full delivery outcome. What approach should Allee use to determine the transaction price for this contract? Explain.
Season tickets for the Dingos are priced at $420 and include 21 home games. An equal amount of revenue is recognized after each game is played. When the season began, the amount credited to Unearned Ticket Revenue was $2,331,000. By the end of October, $1,776,000 of the Unearned Ticket Revenue had been recognized as revenue. a.) How many season tickets did the Dingos sell? b.) How many home games had the Dingos played by the end of October? c.) Prepare the entry for the initial recording of the Unearned Ticket Revenue. Account Titles and Explanation Debit Credit enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount d.) Prepare the entry to recognize the revenue after the first home game had been played. Account Titles and Explanation Debit Credit enter an account title enter a debit amount enter a credit amount enter an account title enter a debit…
Kikiam Company sells equipment service contracts that cover a two-year period. The sales price of each contract is P4,000. Kikiam Company’s past experience shows that of the total pesos spent for repairs in service contracts, 40% in incurred evenly during the first contract year and 60% evenly during the second contract year. Kikiam Company sold 1,500 contracts evenly throughout 2020 and 900 contracts evenly throughout 2021. How much should Kikiam Company report as contract service revenue for the year ended December 31, 2021?
[The following information applies to the questions displayed below.] Steve's Outdoor Company purchased a new delivery van on January 1 for $45,000 plus $3,800 in sales tax. The company paid $12,800 cash on the van (including the sales tax), signing an 8 percent note for the $36,000 balance due in nine months (on September 30). On January 2, the company paid cash of $700 to have the company name and logo painted on the van. On September 30, the company paid the balance due on the van plus the interest. On December 31 (the end of the accounting period), Steve's Outdoor recorded depreciation on the van using the straight-line method with an estimated useful life of 5 years and an estimated residual value of $4,500. Required: 1. Indicate the effects (accounts, amounts, and + or −) of each transaction on the accounting equation. Use the following schedule: (If the transaction does not impact the accounting equation choose "No effect" in the first column under "Assets".)