Refer to the Following Case as You Respond to the Next

question 31

Multiple Choice

Refer to the following case as you respond to the next question: The Celebration Theatre is a small, independent theatre that puts on 12 plays per year. 30 days before the start of each calendar quarter, Celebration prepares advertising for the productions in the upcoming quarter. They advertise on their web site, via e-mail to their season subscribers and via direct mail and brochures to others.Patrons can buy tickets for a single play; alternatively, they can subscribe to all three plays each quarter. Quarterly subscriptions offer a 25% discount from the prices of single tickets. Patrons may purchase tickets over the phone, at the box office or via the theatre's web site. All tickets are held at the box office where they can be picked up as early as one week prior to the performance. The theatre has an "open seating" plan, so patrons do not reserve a specific seat at any performance.If tickets are purchased in person at the box office, non-subscribers may pay with cash or a major credit card; subscribers can pay with cash, major credit card or check. All tickets purchased over the phone or via the web site must be paid for with a major credit card. Celebration maintains an electronic database to track all ticket sales; paper tickets are printed at least ten days prior to a performance.Any paid tickets that are not claimed at least thirty minutes prior to the performance are sold on a "first-come, first-serve" basis at a 50% discount. Refer to the previously presented set of flowcharting symbols labeled Symbol A through Symbol J. Which of the following would best determine whether to use Symbol G or Symbol I to represent the process of selling tickets at the box office?

• A)Whether the process is completed manually or with information technology
• B)Whether the flowchart will be read by someone who understands the process of selling tickets
• C)Whether the tickets are sold to a subscriber or a non-subscriber
• D)Any of the above could be used to make that determination.

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Definitions:

Retained Earnings

Profits generated by a company that are not distributed to shareholders as dividends but are kept as reinvestment in the company or to pay off debt.

Fair Value

What one would receive for selling an asset or pay to transfer a liability in a structured deal among those active in the market at the point of measurement.

Full Goodwill Method

An accounting method that recognizes goodwill based on the full fair value of a subsidiary, not just the portion acquired by the parent company.

Non-controlling Interest

A minority stake in a company that is not enough to control company decisions, represented as a separate component of equity in the consolidated financial statements.