A New York City daily newspaper called “Manhattan Today” charges an annual subsc

Question

A New York City daily newspaper called “Manhattan Today” charges an annual subscription fee of $486. Customers prepay their subscriptions and receive 250 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $460 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $450 per hour. The company estimates that approximately 30% of the coupons will be redeemed

Prepare the journal entry to recognize sale of 13 new subscriptions, clearly identifying the revenue or unearned revenue associated with each performance obligation. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Prepare the journal entry to recognize sale of 13 new subscriptions, clearly identifying the revenue or unearned revenue associated with each performance obligation. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Explanation / Answer

cash a/c........................dr $6318

to subscription $6318

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