Brief Exercise 10-4 Washburn University sells 5,400 season basketball tickets at

Question

Brief Exercise 10-4 Washburn University sells 5,400 season basketball tickets at $48 each for its 20-game home schedule. (a) Give the entry to record the sale of the season tickets. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) (b) Give the entry to record the revenue recognized after playing the first home game. (Round answers to O decimal places, e.g. 125. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Explanation / Answer

a) cash account (5400*48) 259,200

                unearned revenue                    259200

( to record the sales of seasonal tickets)

b) unearned revenue account (5400/20)*48      12960

              service revenue                                                      12960

( To record the revenue earned)

after the first game is over, the revenue already received has to be recognised as service revenue , that is 12960

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