The Defiance College sells season tickets for four home football games at a pric

Question

The Defiance College sells season tickets for four home football games at a price of $15. For the 2007 season, 5,000 season tickets were sold. (a.) Write the journal entry (T Accounts) or use the horizontal model to show the effect of the sale of the season tickets. (b.) Write the journal entry (T Accounts) or use the horizontal model to show the effect of hosting a home football game. (c.) Where on the balance sheet would the account balance representing funds received for games not yet played be classified? Assume that The Defiance College follows the same accounting and financial reporting procedures that are used in business.

Explanation / Answer

Answer:(a)

Cash A/C Dr. $75000

    To Unearned Ticket Revenue A/C    $75000

Answer:(b)

Unearned Ticket Revenue A/C Dr. $18750

       To Ticket Revenue A/C                       $18750

Answer:(c) Unearned ticket revenues are current liabilities.

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