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Carolina university sold 9,000 season football tickets at $100 each for its five-game home schedule. (a) what entry should be made when the tickets are sold?

User Timekiller
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2 Answers

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Answer:

Dr Cash -$900,000 and Cr Unrealized Income( liability) -$900,000

Step-by-step explanation:

In line with International Accounting Standards, revenue can only be recognized when it is probable that any future economic benefit associated with the item of revenue will flow to the entity, and the amount of revenue can be measured with reliability.

In this case, the subscribers of the football tickets are yet to enjoy the service and going by prudency concept, it will be over ambitious for the entity to recognize the revenue as being earned now.

Hence, this should be treated as deferred or unrealized income.

User Combinatix
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Answer:

9,000 *$100 = 900,000

Db. Cash 900,000

Cr. Unearned Ticket Revenue 900,000

User Csalmhof
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