Research a Major League Baseball team’s season ticket prices. Pick one season ticket price level and answer the following questions:
• What team did you choose, and what are the ticket prices for a season?
• What is the sales tax rate for the purchase of season tickets?
• How many games are included in the season package?
• What are the refund and exchange policies for purchases?
• What are some benefits to the team with customers paying in advance for season tickets?
• Explain in detail the unearned revenue liability created from season ticket sales.
• When does the team recognize this future revenue as earned?
• What effect does the refund or exchange policy have on the unearned revenue account, and the ability of the team to recognize revenue?
• If unearned revenue was split equally among all games (not including playoff games), how much would be recognized per game?
• Explain in detail the sales tax liability created from season ticket sales.
• When does the team collect sales tax?
• What is the final purchase price of the season ticket with sales tax?
• Where does the team recognize the sales tax liability (which statement and account[s])?
• To whom does the team pay the sales tax collected?
• When is sales tax payment required?