P4-1A Record transactions on accrual basis; convert revenue to cash receipts
The following selected data are taken from the comparative financial statements of American
Curling Club. The club prepares its financial statements using the accrual basis of accounting.
September 30
Accounts receivable for member dues
Unearned sales revenue
Service revenue (from member dues) $ 2014
15,000
20,000
151,000 2013
19,000
23,000
135,000 $ Dues are billed to members based upon their use of the club’s facilities. Unearned sales
revenues arise from the sale of tickets to events, such as the Skins Game.
Instructions
(Hint: You will find it helpful to use T-accounts to analyze the following data. You must
analyze these data sequentially, as missing information must first be deduced before
moving on. Post your journal entries as you progress, rather than waiting until the end.)
(a)
Prepare journal entries for each of the following events that took place during 2014.
1. Dues receivable from members from 2013 were all collected during 2014.
2. During 2014, goods were provided for all of the unearned sales revenue at the end
of 2013.
3. Additional tickets were sold for $44,000 cash during 2014, a portion of these were
used by the purchasers during the year. The entire balance remaining in Unearned
Sales Revenue relates to the upcoming Skins Game in 2014.
4. Dues for the 2013-2014 fiscal year were billed to members.
5. Dues receivable for 2014 (i.e., those billed in item (4) above ) were partially collected.
(b)
Determine the amount of cash received by American from the above transactions during
the year ended September 30, 2014.
NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" . (a)(1) Cash Value
Accounts Receivable (a)(2) Unearned Sales Revenue
Account Value (a)(3) Additional Tickets Sold
Sales Revenue Value Account Value Account (a)(4) Account
Account Value (a)(5) Account
Account Value (b) Cash received with respect to fees and dues
1. Collection of 2013 dues
3. Sales of tickets
5. Collection of 2014 dues Cash
1.
3.
5.
2014
Bal. 2013
Bal.
4.
2014
Bal. 2.
3. Value
Value
Value
?
Service Revenue
4.
Value Value
Value
Value
? 2014
Bal. Accounts Receivable
Value
1.
Value
5.
Value
Value Sales Revenue
2.
Value
3.
Value
2014
Bal. ? Unearned Sales Revenue
Value
2013
Value
Value
Bal.
3.
Value
2014
Bal. ?