revenue recognition at and after time of sale suite novotel is an all suites hotel c 599605

Revenue recognition at and after time of sale Suite Novotel is an all-suites hotel chain owned and operated by the Accor Group. Most of the hotels in this chain are found in France, Spain, and Germany.

On the company website, customers are offered a nonrefundable special rate at €160 per night, or a refundable rate at €225 per night. In either case, the entire amount is charged to the customer’s account at the time of booking. For the refundable room, if the reservation is cancelled prior to 16.00 on the date of arrival, a full refund of the amount charged is made. If the cancellation occurs after 16.00 the customer forfeits one day at the reserved rate (€225).

Required

Determine the appropriate journal entries for each of the following transactions:

(a) On 6 March a customer makes a nonrefundable reservation for three nights beginning 24 March. The customer arrives as scheduled and checks out on 27 March.

(b) On 6 March a customer makes a reservation identical to the one in part (a). On 21 March, the customer cancels the reservation.

(c) On 6 March a customer makes a refundable reservation for three nights beginning 24 March. The customer arrives as scheduled and checks out on 27 March.

(d) On 6 March, a customer makes a reservation identical to the one in part (c). On 21 March the customer cancels the reservation.

(e) On 6 March, a customer makes a reservation identical to the one in part (c). On 24 March, at 19.30, the customer cancels the reservation.