Textbook Problem

Identified Asset

A customer enters into a 3-year contract with the Raleigh Sports Arena for the right to occupy a luxury box at events. Each luxury box has 20 individual seats. The contract provides that the customer will have the use of 90% of the luxury box’s scats at all events throughout the contract’s term.

Required:

1. 1. Is the capacity portion of the luxury box an identified asset?
2. 2. Is the capacity portion of the luxury box an identified asset if the customer only had the use of 70% of the luxury box’s capacity instead of 90%?