Ticketsales, Inc., receives $4,920,000 cash in advance ticket sales for a four-date tour of Bon Jovi. Record the advance ticket sales on October 31. Record the revenue earned for the first concert date of November 5, assuming it represents one-fourth of the advance ticket sales. Ticketsales, Inc. initially records prepaid and unearned items in balance sheet accounts.

The Journal entries are as follows:

(i) On October 31,

Cash A/c Dr. $7,760,000

        To Unearned ticket revenue A/c  $7,760,000

(To record the Unearned ticket revenue)

(ii) On November 5,

Unearned ticket revenue A/c Dr. $1,940,000

                 To Earned ticket revenue              $1,940,000

(To record the one-fourth of the advance ticket sales)

Working notes:

Unearned ticket revenue:

= $7,760,000 × (1/4)

= $1,940,000

cognitive overload: having a lot on your mind impairs decision-making and tends to result in the simplest, but not necessarily best, option being selected.

empathy gaps: overlooking how you might feel in a different situation can result in unnecessary purchases, such as overbuying when shopping for food on an empty stomach.

optimism and overconfidence: wearing rose-tinted glasses and having unrealistic expectations about the future can affect money management and leave you unprepared for a change in circumstance.

instant gratification: seeking instant gratification drives impulsive spending and can undermine long-term planning and savings.

harmful habits: automatic or mindless behaviour can amplify a poor financial decision as it becomes a recurring event.

social norms: we are heavily influenced by the actions of others; while this can be in certain circumstances, it also contributes to the pressure to keep up with the joneses through conspicuous consumption.

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