The Following Data Are Taken From The Comparative Balance Sh

The Following Data Are Taken From the Comparative Balance Sheets

The Following Data Are Taken From the Comparative Balance Sheets

The following data are taken from the comparative balance sheets of Ottawa Curling Club. The Club prepares its financial statements using the accrual basis of accounting. September Accounts receivable for member dues $17,705 $11,660 Unearned ticket revenue 19,185 25,264 Dues revenue 142,802 Dues are billed to members based upon their use of the Club's facilities. Unearned ticket revenues arise from the sale of tickets to events such as the Skins Game. (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 2010.

Paper For Above instruction

The Ottawa Curling Club's financial activities during 2010 require careful analysis of its balance sheet data to accurately record the relevant journal entries. Utilizing the principles of accrual accounting and transactional analysis via T-accounts ensures proper recognition of revenues and adjustments. In this discussion, we will consider the provided balance sheet figures, analyze the underlying transactions, and prepare the appropriate journal entries to reflect the club's financial events during 2010.

Key Data:

- Accounts receivable for member dues increased from $11,660 to $17,705.

- Unearned ticket revenue decreased from $25,264 to $19,185.

- Dues revenue recorded for the year amounted to $142,802.

Analysis of Transactions:

The increase in accounts receivable for member dues suggests that the club billed additional members or recognized overdue amounts not yet collected. The decrease in unearned ticket revenue indicates that the club recognized revenue from ticket sales as the event occurred, converting unearned revenue into earned revenue. These movements reflect typical accrual accounting processes, where revenues are recognized when earned regardless of cash collection, and unearned revenues are gradually recognized as earned as the related obligations are fulfilled.

Journal Entries:

Based on the data, several journal entries would be necessary:

1. Recording Dues Billed:

The club billed members for dues during the period, increasing accounts receivable and revenue.

2. Recognizing Revenue from Ticket Sales:

When part of the unearned revenue is earned through events, it must be reclassified from liability to revenue.

3. Collection of Dues:

Cash collections related to receivables would be recorded separately from revenue recognition but are not directly indicated here.

Detailed Journal Entries:

- To record dues billed during the year:

Accounts Receivable Dr. (increase), Dues Revenue Cr.

- To recognize revenue from ticket sales:

Unearned Ticket Revenue Dr., Ticket Revenue Cr.

- To record cash received from dues and ticket sales, additional information would be needed, but these are the primary revenue recognition entries based on balance sheet changes.

Conclusion

This analysis illustrates how to interpret balance sheet changes for ledger adjustments and highlights the importance of understanding transactional flows within accrual accounting. Accurate journal entries ensure proper financial statement representation, facilitating transparency and accountability for the Ottawa Curling Club's financial activities during 2010.

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