Transactions below relate to Kansas City Royals, Inc. owner of a professional baseball team and Royals Stadium. Indicate whether or not each of the following transaction immediately gives rise to a liability of the finn under generally accepted accounting principles. If accounting recognizes a liability, state the account title and amount.

a. The firm signs a 5-year contract with Joe Superstar for $1,400,000 per year. The contract period begins on February I of next year.

b. The firm receives $2,700,000 from sales of season tickets for the baseball season starting April I of next year.

c. The firm issues bonds in the principal amount of $8,000,000 for $8,400,000. The bonds mature in 20 years and bear interest at 8 percent per year. The Simi intends to use the proceeds to expand Royals Stadium.

d. The firm receives a bill for utility services received lost month totaling $3,400.

e. The firm receives notice that a former player has filed suit against Kansas City Royals. Inc. alleging non perfomiance of contractual terms. The player claims $10,000,000 in damages.

f. The firm orders new uniforms for the team for the baseball season beginning next spring. The contract calls for a $10,000 deposit upon signing the contract, which payment was made, and a SI 5,000 payment upon delivery of the uniforms in February of next year

Answer rating: 100% (QA)

Liability recognition and valuation a As the firm has just signed the contract and the contract will ... View the full answer