USE ASPE; ENDING YEAR IS DEC 31, 20X1 Currently, there are 100 stations within a nine-square-kilometer radius of the Tor
Posted: Sun Jul 03, 2022 3:59 pm
USE ASPE; ENDING YEAR IS DEC 31, 20X1
Currently, there are 100 stations within a nine-square-kilometerradius of the Toronto centre. The new stations would be dispersedacross an extra six square kilometres. In the first year, UBER'ssales and marketing team estimates that these new stations willgenerate 600 extra monthly subscriptions (at a cost of $25 permonth) and 5,000 additional annual memberships (at a rate of $100per year).
The Toronto bicycles are accessible year-round. InToronto, UBER's pay-per-use income accounts for almost fiftypercent of all yearly and monthly membership costs combined. Since UBER's has an advertising arrangement in Toronto that permitsSeneca college to place its brand on the bicycles, it may collectan extra $175 per bicycle each year. In one year, it ispredicted that bicycle utilisation would increase by an additional10 percent, but expansion beyond this point would be impossible dueto capacity constraints.
In addition to the costs of the bikes and stations, annual costsassociated with the new stations would include bike maintenance of$50 per bike, truck operating costs and maintenance of $200,000,wages of $160,000, general and administrative costs of $100,000,and average monthly rental of $100 per station space.
UBER is introducing a new incentive to Toronto members in orderto enhance its exposure during the winter months, when bicycleutilisation normally drops.
All yearly members who check out a UBER bike more than 75 timesbetween December and March will earn a 25% rebate on their annualsubscriptions for 2021.
UBER believes that 20 percent of the 10,500 annual Torontomembers will reach the objective and qualify for thereimbursement.
How do we account for this in 2021 and subsequent years if thispromotion continues?
We acquired 120 bicycles (type Uber 1) four years ago and theyare now in use in Toronto. Shortly after purchasing these bikes, wewere able to secure a deal with a different manufacturer to developa far cheaper and lighter bike (model uber 2). The uber 1 bicyclesare still functional, although they are heavier and not quite asattractive as the more recent models.
Our operations manager gained agreement from Jasmine and theboard of directors last month to replace the whole fleet of uber 1swith uber 2s. Last Monday, he arranged an agreement to sell alluber 1s to a summer camp for $40,000 on June 1, 2013. Thecampground has consented to our continued usage of the bicyclesuntil then. The current carrying capacity of the fleet of bicyclesis roughly $45,000. The anticipated cost to carry the bicycles tothe campsite is $1,000.
Accounting issue ?
Currently, there are 100 stations within a nine-square-kilometerradius of the Toronto centre. The new stations would be dispersedacross an extra six square kilometres. In the first year, UBER'ssales and marketing team estimates that these new stations willgenerate 600 extra monthly subscriptions (at a cost of $25 permonth) and 5,000 additional annual memberships (at a rate of $100per year).
The Toronto bicycles are accessible year-round. InToronto, UBER's pay-per-use income accounts for almost fiftypercent of all yearly and monthly membership costs combined. Since UBER's has an advertising arrangement in Toronto that permitsSeneca college to place its brand on the bicycles, it may collectan extra $175 per bicycle each year. In one year, it ispredicted that bicycle utilisation would increase by an additional10 percent, but expansion beyond this point would be impossible dueto capacity constraints.
In addition to the costs of the bikes and stations, annual costsassociated with the new stations would include bike maintenance of$50 per bike, truck operating costs and maintenance of $200,000,wages of $160,000, general and administrative costs of $100,000,and average monthly rental of $100 per station space.
UBER is introducing a new incentive to Toronto members in orderto enhance its exposure during the winter months, when bicycleutilisation normally drops.
All yearly members who check out a UBER bike more than 75 timesbetween December and March will earn a 25% rebate on their annualsubscriptions for 2021.
UBER believes that 20 percent of the 10,500 annual Torontomembers will reach the objective and qualify for thereimbursement.
How do we account for this in 2021 and subsequent years if thispromotion continues?
We acquired 120 bicycles (type Uber 1) four years ago and theyare now in use in Toronto. Shortly after purchasing these bikes, wewere able to secure a deal with a different manufacturer to developa far cheaper and lighter bike (model uber 2). The uber 1 bicyclesare still functional, although they are heavier and not quite asattractive as the more recent models.
Our operations manager gained agreement from Jasmine and theboard of directors last month to replace the whole fleet of uber 1swith uber 2s. Last Monday, he arranged an agreement to sell alluber 1s to a summer camp for $40,000 on June 1, 2013. Thecampground has consented to our continued usage of the bicyclesuntil then. The current carrying capacity of the fleet of bicyclesis roughly $45,000. The anticipated cost to carry the bicycles tothe campsite is $1,000.
Accounting issue ?