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ezto.mheducation.com/hm.tpx?-0.5816731058294722-1510601004544 Apps Bookmarks ESCI 111 Quiz 10 F Questions 1-2(of 15) M10-1 Recording Unearned Revenues [LO 10-2] The following information applies to the questions displayed below A local theater company sels 1,050 season ticket packages at a price of $260 per package. The first show in the ten-show season starts this week. (a) The sale of the season tickets before the first show (b) The revenue earned after putting on the first show. References M10-1 Recording Unearned Revenues LO 10-2 Section Break value: 0.52 points M10-1 Part 1 1. Indicate the effects of the amounts for the above transactions. (Enter any decreases to account balances with a minus sign.)Explanation / Answer
Solution:
1)
Assets
=
Liabilities
+
Stockholders' Equity
(a)
Cash Increase
$273,000
=
Unearned Revenue Increase
$273,000
(b)
Unearned Revenue Decrease
-273000
Increase
-273000
2) Journal Entries
Account Titles and Explanation
Debit
Credit
(a)
Cash (1050*260)
$273,000
Unearned Sales Revenue
$273,000
(b)
Unearned Sales Revenue
$273,000
Sales Revenue
$273,000
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Assets
=
Liabilities
+
Stockholders' Equity
(a)
Cash Increase
$273,000
=
Unearned Revenue Increase
$273,000
(b)
Unearned Revenue Decrease
-273000
Increase
-273000
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