Alpine West, Inc., operates a downhill ski area near Lake Tahoe, California. An all-day, adult ticket can be purchased for $55. Adult customers also can purchase a season pass that entitles the pass holder to ski any day during the season, which typically runs from December 1 through April 30. The season pass is nontransferable, and the $450 price is non refundable. Alpine expects its season pass holders to use their passes equally throughout the season. The company's fiscal year ends on December 31.
On November 6, 2013, Jake Lawson purchased a season ticket.
Required:
1.When should Alpine West recognize revenue from the sale of its season passes?
Equally throughout the season
Full amount before the season
Full amount after the season
2.Prepare the appropriate journal entries that Alpine would record on November 6 and December 31. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Use months, rather than days, to calculate the earned and unearned revenue amounts.)