1056 PM omhcationm iPad Chapter 9 Quiz instructions help Que

10:56 PM omhcationm iPad Chapter 9 Quiz instructions help Question 3 (of 15) Save & Exit Submit Time remaining: 1:46:14 3. Kirkland Theater sells season tickets for six events at a price of $88. In pricing the tickets, the planners assigned the leadoff event a value of $26 because the program was an expensive symphony orchestra. The last five events were priced equally: 1,090 season tickets were sold for the 2016 season. Required a. Calculate the theater\'s earned revenue after the first three events have been presented. (Do not round intermediate calculations.) nue earned b. About 93% of the season ticket holders attended the first event. Subsequent events were attended by about 77% of the season ticket holders. Would the attendance data impact revenue recognition? O Yes ONo eBook & Resources

Solution

a) $55,372

Season ticket price. $88

Price for first program event ($26)

Balance for five remaining events $62

Price per remaining event. $12.4

After 3 events $50.8 ( $26 + $12.4 + $12.4) of revenue has been earned from each ticket thus total season ticket earned = $50.8*1,090 = $55,372

b) No

The fact that all tickets aren\'t used is irrelevant to the revenue recognition process because the critical event is the delivery of the service (i.e., presentation of the program).