Question

Required information [The following information applies to the questions displayed below.] Vail Resorts, Inc., owns and operates 11 premier year-round ski resort properties (located in the Colorado Rocky Mountains, the Lake Tahoe area, the upper midwest, Vermont, and Australia). The company also owns a collection of luxury hotels, resorts, and lodging properties. The company sells lift tickets, ski lessons, and ski equipment. The following hypothetical December transactions are typical of those that occur at the resorts. a. Borrowed $4,200,000 from the bank on December 1, signing a note payable due in six months. b. Purchased a new snowplow for $89,000 cash on December 31. c. Purchased ski equipment inventory for $37,000 on account to sell in the ski shops. d. Incurred $68,000 in routine repairs expense for the chairlifts; paid cash. e. Sold $374,000 of January through March season passes and received cash. f. Sold a pair of skis from inventory in a ski shop to a customer for $550 on account. (The cost of the skis was $320). (Hint: Record two entries.) g. Sold daily lift passes in December for a total of $272,000 in cash. h. Received a $3,700 deposit on a townhouse to be rented for five days in January. i. Paid half the charges incurred on account in (c). j. Received $320 on account from the customer in (f). k. Paid $259,000 in wages to employees for the month of December.

Answer 1

Vail Resorts Inc. Journal Enteries Trans. Particulars a. Cash a/c Dr. To Note Payable (Cash borrowed) Debit in $ Credit in $ 4200000 4200000 b. 89000 Snowplow a/c Dr. To Cash (Snowplow purchased) 89000 37000 Inventory a/c Dr. To Accounts Payable (Inventory on account) 37000 d. 68000 Repairs expense a/c Dr. To Cash (Repairs paid) 68000 e. 374000 Cash a/c Dr. To Unearned Revenue (Season passes sold) 374000 550 Accounts Receivable a/c Dr. To Sales (Sales on account) 550 320 Cost of goods sold a/c Dr. To Inventory (To record cost of goods sold) 320 Dr. 272000 Cash a/c To Sales (Sold lift passes) 272000 3700 Cash a/c Dr. To Unearned Rent Revenue (Rent deposit for January) 3700 18500 Accounts Payable a/c Dr. To Cash (Creditors paid) 37000 / 2 18500 320 Cash a/c Dr. To Accounts Receivable (Cash from debtors) 320 Dr. 259000 Wages Expense a/c To Cash (Wages paid) 259000