Question

Exercise 8-11A Record gift card transactions (LO8-4)

Vail is one of the largest ski resorts in the United States. Suppose that on October 1, 2021, Vail sells gift cards (lift passes) for $100,000. The gift cards are redeemable for one day of skiing during the upcoming winter season. The gift cards expire on April 1, 2022. Customers redeem gift cards of $20,000 in December, $30,000 in January, $25,000 in February, and $15,000 in March.

1. Record the sale of gift cards on October 1, 2021.

2. Record the redemption of gift cards as of December 31, 2021.

3.Record the redemption of gift cards in 2022 by preparing a summary entry as of March 31, 2022.

4.Record the redemption of gift cards in 2022 by preparing a summary entry as of March 31, 2022.

Answer 1

Date	Account title	Debit	credit
October 1, 2021	cash	100000
	unearned revenue		100000
	[Being gift card sold to be redeemable in future]
December 31, 2021	unearned revenue	20000
	sales revenue		20000
	[being gifts card redeemed]
January 31 2022	unearned revenue	30000
	sales revenue		30000
February 28 ,2022	unearned revenue	25000
	sales revenue		25000
march 31 2022	unearned revenue	15000
	sales revenue		15000
April 1 2022	unearned revenue	10000
	sales revenue		10000
	[being revenue on cards expired earned 100000-30000-20000-25000-15000]