Chapter 8, Problem 8.20E

Other Principal Agent Transactions, Net Revenue Reporting Method. ATickets.com sells discount airline tickets online. The company orders the tickets after a customer makes a purchase request. Atickets.com earns a flat fee of 25% of the total t cket price. The company sold $1,000,000 in airline tickets during the current year and had collected $800,500 as of the end of the year ATickets com is an agent in this transaction and thus uses the net revenue reporting method of accounting for sales.

Required

1. a. Record the sales transactions for the current year.
2. b. Record the cash collections for the current year.
3. c. Record the amount remitted to the airlines.