On January 1, the Thunderball Hockey Association sold 1,000 season passes for $110 each. The season lasts from February through May. If the amount received was credited to unearned ticket revenue, what adjusting entry will be made on February 28?

Question

Quizplus · Accepted Answer

The season lasts four months (February to May), so each month, 1/4 of the revenue should be recognized. For February, the revenue recognized is $ \frac{1,000 \times 110}{4} = 27,500 $. The adjusting entry is to debit Unearned Ticket Revenue and credit Ticket Revenue for $27,500.

On January 1, the Thunderball Hockey Association Sold 1,000 Season Prepaid Ticket Revenue 27,500 Ticket Revenue 27,500\begin{array}{lrr} \text {Prepaid Ticket Revenue } &27,500\\ \text { Ticket Revenue } &&27,500\\\end{array}Prepaid Ticket Revenue Ticket Revenue ​27,500​27,500​

On January 1, the Thunderball Hockey Association Sold 1,000 Season $\begin{array}{lrr} \text {Prepaid Ticket Revenue } &27,500\\ \text { Ticket Revenue } &&27,500\\\end{array}$