Question
Recognition? Measurement? English Opera House (ENO) had the following (hypothetical) events. Indicate whether each transaction immediately gives rise to a liability. If Yes, what would
Recognition? Measurement? English Opera House (ENO) had the following (hypothetical) events. Indicate whether each transaction immediately gives rise to a liability. If Yes, what would the amount be?
1. ENO receives 3,000,000 for season tickets, sold for next season 2. ENO places an order with a printing firm totaling 180,000 for performance programs 3. ENO receives the programs related to 2. above and invoice for 180,000. 4. ENO receives notice from their legal team that a loyal customer who attended the Marriage of Figaro last season and who sat in the first row is suing ENO for 8 million, claiming hearing loss. The customer normally sits farther back but due to damage seating was asked by staff to move forward for this particular opera. 5. ENO signs a three-year contract with its Piccolo player at a salary of 120,000 per annum. 6. ENO signs a five-year contract with Andrea Bocelli, to be a spokesman for ENO. Under the terms of the deal ENO will pay compensation of 1 million a year. Andrea Bocelli will earn this compensation regardless of whether the ENO asks him to perform any speaking engagement each year.
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