Accounting Analysis I: The Role of Accounting as an Information System | Online Course Support

Davis Inc., operates a downhill ski area near Champaign, Illinois. An all-day adult lift ticket can be purchased for $85. Adult customers 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. Davis Inc. expects its season pass holders to use their passes equally throughout the season. The company’s fiscal year ends on December 31.

 
 
 
 
 
 

Davis Inc. should recognize revenue equally over the five months of ski season (December 1, 2016–April 30, 2017). Davis Inc. fulfills its performance obligation over time as it delivers the service to its pass holders by providing access to its ski lifts.

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