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sveticcg
9 days ago
12

Vail is one of the largest ski resorts in the United States. Suppose that on October 1, 2021, Vail sells gift cards (lift passes

) for $100,000. The gift cards are redeemable for one day of skiing during the upcoming winter season. The gift cards expire on April 1, 2022. Customers redeem gift cards of $20,000 in December, $30,000 in January, $25,000 in February, and $15,000 in March.
1. Record the sale of gift cards on October 1, 2021.2. Record the redemption of gift cards as of December 31, 2021.3.Record the redemption of gift cards in 2022 by preparing a summary entry as of March 31, 2022.4.Record the redemption of gift cards in 2022 by preparing a summary entry as of March 31, 2022.
Business
1 answer:
soldi70 [3.4K]9 days ago
7 0
Vail Journal recorded the following entries: October 1, 2021, received cash of 100,000 debited to Cash and credited 100,000 to Deferred Revenue. On December 31, 2021, debited 20,000 from Deferred Revenue and credited 20,000 to Sales Revenue. For January 2022, debited 30,000 from Deferred Revenue and credited 30,000 to Sales Revenue. In February 2022, debited 25,000 from Deferred Revenue and credited 25,000 to Sales Revenue. Finally, in March 2022, debited 15,000 from Deferred Revenue and credited 15,000 to Sales Revenue. Deferred revenue represents money received for goods or services not yet delivered, hence it is a liability until the service is provided and then it is recognized as revenue.
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