A number of the leading nightclubs and pool party locations in Las Vegas such as Wet Republic at MGM Grand and Venus at Caesars Palace have found themselves in the difficult position where there is such great demand for their venues that has far exceeded their capacity during the current travel boom. The owners of these locations have met at the Griffin Casino on Freemont to determine a possible strategy to ensure that the “premium” guests are able to attend these locations as they wish and still allow for the venue to remain in compliance with the various fire and health code regulations. The purchases made by the “premium” guests account for 70% of the venues total revenues yet they only account for 20% of the capacity so a system is needed to ensure that they do not wait in line. Many patrons are attracted to these locations due to the “A-list” social media stars such as Addison Rae, Logan Paul as well as most of the Kardashians that are known to attend and post their experiences on social media which further increases the volume of guests who want to attend the locations. These A-list guests do not wait in line and do not go through the usual screening process in place. Instead they get escorted to the extreme VIP area at these venues and are not required to pay for any of the items they order. In order to allocate room for these guests, most venues operate at 30 persons less than their total maximum capacity. No revisions are needed in this area of their operations. The owners have enjoyed several rounds of cocktails and have come up with a few ideas on how to fast track the premium guests in terms of their arrival at valet parking, getting into the venues and also speeding up their purchase transactions. The key strategy of the group is to identify those who qualify as premium guests and to ensure that only the premium guests enjoy the benefits that the clubs are aiming to continue to provide them. The idea of VIP cards with photo ID and perhaps even credit card information contained in them will not be further considered as this will still need for scrutiny of each guest’s VIP card as they arrive and will not speed up their purchase transactions. After some more cocktails, the group has come up with 2 related ideas, one of which is more extreme than the other. To achieve the goal of having a non-transferable electronic identification system in place, qualified premium guests can have a microchip earring installed in either their left or right ear or as a nose ring if they wish. This 2 part microchip earring will shut down and cease to operate if it is separated from the backing which is used to keep it in place. This will avoid guests from sharing their premium guest status and devices. The other, more extreme option, likely inspired by the first Jason Bourne movie that was playing on the TV’s during the meeting, involves the premium guest having the microchip (about the size of a Tylenol pill) placed below the skin on their left or right forearm. The thought was that there are some guests who would be very motivated to go for this option as it would provide them with a great conversation topic as well as a likely Instagram posting of the pain free installation. Aside from the premium guests being able to virtually walk right through the chip sensor at the entrance, they would be asked to pay a $5,000 deposit on their drink and beverage tab. As drinks, beverages and services are provided at the venues, the monies would be withdrawn from their “tab”. This would ensure a seamless ordering and payment system. Once the guests tab gets below $500, the guests credit card is debited for an additional $4,500 to bring it back up to the $5,000 threshold. Server staff at the venues would have sensor wands to scan the ring or chip. The gratuity level would be set at an automatic 20% on each order.

Required

You may find point form best for your responses to each of these 4 required items. Please clearly indicate each of the 4 items that you are providing your response to,

A. From an Accounting Information System perspective, what are your thoughts on these options. Identify the pros and cons of these options from the perspective of the venue operators.

B. As a venue operator, what type of information would you want these microchips to collect and how could it be used.

C. For the premium guests, identify what are the pros and cons of this proposal.

D. IF, you qualified as a premium guest, would you get either of these 2 microchip options, why would you or, why would you not.

Answer rating: 100% (QA)

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