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The amount of adjusting entry is the difference between the beginning and ending balance of unearned rent. $90,000 c. $54,000 d. $36,000 The amount that was earned is the $40,000 received minus the $3,000 that is unearned. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is $54,000 A business pays biweekly salaries of $20,000 every other Friday for a ten-day period ending on that day. ANSWER: c. DIFFICULTY: Moderate Brief Exercise 3-9. 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To account for this, decrease in usefulness, the cost of fixed assets is systematically allocated to expense through a process called, Unearned rent, representing rent for the next six months' occupancy, would be reported on the landlord's balance, The system of accounting where revenues are recorded when they are earned and expenses are recorded when. b. Pedroni Oil Company purchased packaging equipment on January 8 for $72,000.The equipment was expected to have a useful life of three years or 18,000 operating hours, and a … $3,000 b. Term The unearned rent account has a balance of $72,000. Unearned Subscription Revenue, $150 and credit Subscription Revenue, $150. However, adjusting entries have not been made at the end of the period for supplies expense of $2,200 and accrued salaries of $1,300. 45) The unearned rent account has a balance of $72,000. Select the best explanation for the entry. $54,000 C. $18,000 d. $36,000 Get more help from Chegg Unearned rent is never actually "closed" but actually brought down to a zero balance account.For example, your company was paid rent for December 2010, and January and February 2011 in … At the beginning of the year, the Unearned Rent account has a balance of $30,000. A company pays $360 for a yearly trade magazine on August 1. The adjusting entry would be: Carnival Corporation accounts for customer deposits as deferred, or unearned, revenue. If your small business collects unearned fees, you must record the fees initially as a liability on the balance … If $4,000 of the $36,000 is unearned at the end of the accounting period, the amount of the adjusting entry is Dec 21 2013 01:44 PM. c. $37,000. Subscriptions Earned                  11,500, A. increase liabilities, increase revenues, B. decrease liabilities, increase revenues, C. decrease liabilities, decrease revenues, Unearned rent, representing rent for the next six months' occupancy, would be reported on the landlord's balance sheet as a(n). The unearned rent account has a balance of $40,000. Cr. A contra asset account for Land will normally appear in the balance sheet. D) $4,000. Proper reporting of revenues and expenses in a period is due to the accounting period concept. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is Select one: a. C. Vertical analysis may be prepared for several periods to analyze changes in relationships over time. To account for this unearned rent, the landlord records a debit to the cash account and an offsetting credit to the unearned rent account (which is a liability account). Show transcribed image text Assume that on September 1, 2016, a 6-month rent payment for $12,000 per month (for a total of $72,000) was made with respect to a commercial lease that the company entered into on that date as a tenant. A. The current balance in Unearned rent revenue is the $24,000 that was credited to the liability account on September 1. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is. A fixed asset’s market value is reflected in the Balance Sheet. The unearned rent account has a balance of $71,354. Solution for The unearned rent account has a balance of $48,818. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is A. 11. Lv 4. Accumulated Depreciation is reported on the income statement. $90,000 c. $54,000 d. $36,000 ____ 57. If $18,000 of the $72.000 accounting period, the amount of the adjusting entry is a. Select the best explanation for the entry. The adjusting entry on December 31 is debit. The income account shall have a balance of $20,000. 2 Answers. The unearned rent account has a balance of $60,000.If $4,000 of the $60,000 is unearned at the end of the accounting period, the amount of the adjusting entry is: A) $64,000. The unearned rent account has a balance of $72,000. , A customer's written promise to pay an amount and possibly interest at an agreed-upon rate. Note that in either approach to recording the initial cash receipt, the end result is the same: $500 earned and $1,500 unearned. Closing entry... Dr. Unearned Rent Revenue 32,000. $4,000. The unearned rent account has a balance of $36,000. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is a. 1 decade ago. Top of Form. Answer:View Answer. The amount removed from income shall be transferred to liability (Unearned Rent Income). If $5,000 of the $20,000 is unearned at the end of the accounting period, the amount of the adjusting entry is: A) $15,000 B) $5,000 C) $20,000 D) $10,000 2.A fixed asset with a cost of $30,000 and accumulated depreciation of … Once it provides the first lawn service, it will record a debit to its unearned revenue account in the amount of $40. Services, Unearned Revenue in Accounting: Definition & Examples, Working Scholars® Bringing Tuition-Free College to the Community. $40,000. $3,000. If $3,212 of the $42,860 is unearned at the end of the accounting period, find the amount of the adjusting entry. The unearned rent account has a balance of $72,000. At the end of the fiscal year, the usual adjusting entry to Prepaid Insurance to record expired insurance was omitted. $54,000 Under a periodic inventory system In other words, since $900 of supplies were purchased, but only $200 were left over, then $700 must have been used. $90, C. $54, D. $36, The following adjusting journal entry does not include an explanation. If $3,000 of the $40,000 is unearned at the end of the accounting period, the amount of the adjusting entry is $37,000.. $24,000 . If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is. For example, if an asset account which is expected to have a debit balance, shows a credit balance, then this is considered to be an abnormal balance. Solution for The unearned rent account has a balance of $48,818. The unearned rent account has a balance of $36,000. If $4,000 of the $36,000 is unearned at the end of the accounting period, the amount of the adjusting entry is Dec 21 2013 01:44 PM. d. $43,000. Assets. If $3,212 of the $42,860 is unearned at the end of the accounting period, find the amount of the adjusting entry. For example, you would record revenue when a project is complete, rather than when you get paid. As of December 31, the tenant has occupied the space for four months: September through December. b. The unearned rent account has a balance of $72,000. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is A. The unearned rent account has a balance of $72,000. For example, a building account with a credit balance is impossible because it implies that the business somehow has negative buildings, which is a nonsensical implication. What journal entry is made when a purchase commitment is originally entered into? If the fiscal year closes before the company completes the transaction, the balance sheet will reflect the increase in liabilities for the unearned income. Warren Company began the accounting period with a $32,000 debit balance in its accounts receivable account.During the accounting period,the company recorded revenue on account amounting to $88,000.The accounts receivable account at the end of the accounting period contained a $16,000 debit balance.Based on this information,what is the amount of cash collected from customers during the … Submitted: 11 years ago. The unearned rent account has a balance of $72,000. The unearned rent (another name is "deferred rent revenue") account has a balance of $72,000. All rights reserved. The unearned rent account has a balance of $40,000. Trial Balance. Answered in 13 minutes by: 2/3/2009. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is. Calculate the ending balance of the account. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is A.$18,000 B.$90,000 C.$54,000 D.$36,000. The office furniture has a 5-year life with no salvage value. Show Less. When is the adjusted trial balance prepared? 3. If $3,000 of the $40,000 is unearned at the end of the accounting period, the amount of the adjusting entry is. Bob. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is a. Determine the balances of the accounts affected by the adjusting entries and prepare an adjusted trial balance. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is a. Best answer. Opening entry... Dr Cash 36,000. 2. C) $60,000. 4 points out of 4 Flag question Question text The unearned rent account has a balance of $72,000. The Unearned Rent account balance at the end of the year is $6,000. Given this information, Rent Revenue for the current year must be: a. $36,000 For example, a company that receives $144 in advance for magazine subscriptions must credit unearned revenue for $144. $24,000 . C. Concert tickets sold yesterday on credit for yesterday’s performance. 1 Approved Answer. Notice how we start with the unadjusted trial balance in each account and add any debits on the left and any credits on the right. Concert tickets sold last month for yesterday’s performance. Prepare the adjusting journal entry to correctly report the balance of the Supplies account and the Supplies Expense account as of December 31 , 2013. Determine the dollar amount and direction (+ or -) by which the company must change its prepaid rent resource at the end of February. Show Less. Since the account has a $900 balance from the December 8 entry, one “backs in” to the $700 adjustment on December 31. Our experts can answer your tough homework and study questions. The system of accounting where revenues are recorded when they are earned and expenses are recorded when they are incurred is called the cash basis of accounting. Which of the following is not true regarding depreciation? The unearned rent account has a balance of $72,000. The trial balance of Yewlett Company includes the following balance sheet accounts, which may require adjustment. $36,000. a) $42,860 b) $46,072 c) $39,648 d) $3,212 Ask Your Own … Rent Revenue 32,000 . Current Liabilities . The company took occupancy of the rented space immediately. All other trademarks and copyrights are the property of their respective owners. $90,000 b. The unearned rent account has a balance of $60,000.If $4,000 of the $60,000 is unearned at the end of the accounting period, the amount of the adjusting entry is: A) $64,000. Concert tickets sold for next month’s performance. MC.03-108 The unearned rent account has a balance of $72,000. The unearned rent account has a balance of $72,000 . The unearned rent account has a balance of $72,000. The unearned rent account has a balance of $40,000. Given this information, Rent Revenue for the current year must be: a. Ans: c. $54,000. 2. B. Which of the following statements is true? The unearned rent account has a balance of $40,000. Depreciation expense reflects the decrease in market value each year. create, study and share online flash cards, A company pays $360 for a yearly trade magazine on August 1. 10. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is a. 15. They include items such as salaries payable, interest payable, and taxes payable. 14. A) $28,000 debit. a) $42,860 b) $46,072 c) $39,648 d) $3,212 C) $60,000. As of December 31, 2013, a supplies inventory shows $800 of supplies available. D) $4,000. Expert Answer 80% (5 ratings) d. $54,000. $30,000 . Accrued but uncollected revenue is reported in the balance sheet as accounts receivable. ANS: C DIF: 3 OBJ: 03. When an account has a balance that is opposite the expected normal balance of that account, the account is said to have an abnormal balance. Now your end balance in unearned rent revenue is 4,000. Click here to study/print these flashcards. B. $90,000. D) $22,000 debit . c. $24,000 loss. If $4,000 of the $36,000 is unearned at the end of the ac? Some ledger accounts have a debit balance, some have a credit balance. b. If $18,000 of the $72,000 is unearned at the end 9. A. D. Concert tickets that were not sold for the current performance. Accruals are needed when an unrecorded expense has been incurred or an unrecorded revenue has been earned. At the beginning of the year, the Unearned Rent account has a balance of $30,000. Category: Homework. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry … $24,000 in rent for one year is $2,000 per month. Under the liability method, a liability account is recorded when the amount is collected. answered Jan 5 by MThomas89 . 2. Which of the following is considered to be unearned revenue? $18,000 b. c. $18,000. 1.The unearned rent account has a balance of $20,000. The net income reported on the income statement is $58,000. The unearned rent account has a balance of $72,000. $18,000 b. The balance in the prepaid insurance account as of November 30, 2013, was $35,200 (before adjustment at Nov. 30, 2013) and consisted of the following policies: Policy Date of Date of Balance in Number Purchase Expiration Account 279248 7/1/2013 6/30/2014 $14,400 694421 12/1/2011 11/30/2013 9,600 800616 4/1/2012 3/31/2014 11,200 $35,200 The adjusting entry required on November 30, 2013, … The unearned rent account has a balance of $72,000. To account for this decrease in usefulness, the cost of fixed assets is systematically allocated to expense through a process called, The account type and normal balance of Unearned Revenue is. The unearned rent account has a balance of $72,000. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is: Unearned Rent is a liability in which cash is received in advance for rental payments that will be incurred in the future. The unearned rent account has a balance of $40,000. Write a credit in the unearned revenue account. The annual accounting period adopted by a business., The ability to convert assets into cash., Long-term or relatively permanent tangible assets such as equipment, machinery, and buildings that are used in the normal business operations that depreciated over time. This method is more commonly used than the cash method. Totals $72,000 $48,000 $60,000 $84,000 The net income (or loss) for the period is a. a. In addition to those accounts listed on the trial balance, the chart of accounts for Cuono Company also contains the following accounts and account numbers: No. A. Rent expense: 4,500: 4,500: Office supplies expense: 0: f. 480: Advertising expense: 3,000: 3,000: Utilities expense: 1,250: g. 1,320: Total expenses: 21,250: 28,800 : Net income: $45,250: $43,700: Analyze the statements and prepare the eight adjusting entries a through g that likely were recorded. 15. Sciences, Culinary Arts and Personal If $3,570 of the $48,818 is unearned at the end of the accounting period, the amount of the… $40,000 c. $37,000 d. $43,000 ANS: C DIF: 3 OBJ: 03 52. Trial balance is an accounting report that lists the closing balance of each ledger account on a particular date. Unearned Revenue is a Liability and like all Liabilities it has a Credit Balance.I decided to add this as I have been asked "why" is Unearned Revenue a liability isn't it Revenue?Yes and no. 11. Event b. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is; $18,000; $90,000; $54,000; $36,000 . true false, Accrual accounting is a method of accounting where revenues and expenses are recorded when they are earned, regardless of when the money is actually received or paid. If $3,000 of the $40,000 is unearned at the end of the accounting period, the amount of the adjusting entry is a. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is. The adjusting entry on December 31 is debit Unearned Subscription Revenue, $150 and credit Subscription Revenue, $150. $24,000 income. $48,000 income. The unearned rent account has a balance of $36,000. Which of the following is not a characteristic of accrual basis of accounting? $30,000 . If $3,000 of the $40,000 is unearned at the end of the accounting period, the amount of the adjusting entry is; a. If $3,570 of the $48,818 is unearned at the end of the accounting period, the amount of the… A. before adjusting journal entries are posted, B. after the adjusting journal entries are journalized, C. before the adjusting journal entries are journalized, D. after adjusting journal entries are posted, Data for an adjusting entry described as "accrued wages, $2,020" would result in, A. a debit to Dividends and a credit to Wages Payable, B. a debit to Accounts Receivable and a credit Wages Expense, C. a debit to Wages Payable and a credit to Wages Expense, D. a debit to Wages Expense and a credit to Wages Payable, The unearned rent account has a balance of $72,000. The amount that was earned is the $40,000 received minus the $3,000 that is unearned. © copyright 2003-2020 Study.com. $90,000 c. $54,000 d. $36,000. The unearned rent account has a balance of $72,000. The unearned rent account has a balance of $72,000. May 31 is a Wednesday, and employees are paid on Friday, Krause Consulting has two employees, who are paid $920 each for a 5-day work week. Jill Parsons purchases for $72,000 Jamar\'s interest in the Tholen-Jamar partnership. What journal entry is made when unearned revenue is earned? If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is 108. If the liability method is used, the entry would be:Take note that the amount has not yet been earned, thus it is proper to record it as a liability. d. $ 6,000 . The updating of accounts is called the adjusting process. accounting-and-taxation 0 Answer. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is: If $4,000 of the $36,000 is unearned at the end of the ac? The unearned rent account has a balance of $42,860. For this illustration, let us use Unearned Revenue.Suppose on January 10, 2017, ABC Company made $30,000 advanced collections from its customers. d. $ 6,000 . Prepaid rent (for the next two years) 66,000 Unearned revenue 34,000 Accounts payable 170,000 Note payable 340,000 Cash restricted for payment of note payable 73,000 Allowance for uncollectible accounts 12,200 Sales revenue 880,000 Cost of goods sold 540,000 Rent expense 19,000 The following adjusting journal entry does not include an … During 2013, it purchased $2,000 of supplies. Shandi Company has a Supplies account balance of $5,000 on January 1. Relevance. An unearned fee in accounting is money a business collects from a customer up front for services the company has yet to perform, such as a prepaid annual membership. C) $3,000 credit. Step 2: Determine what the current account balance should equal. 51. Assets = Liabilities + Stockholders' Equity. Revenues and expenses are reported in the period in which cash is received or paid, B. Show More. It is being depreciated at $190 per month for 60 months. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is Group of answer choices $18,000 For each account that requires adjustment, indicate the type of adjusting entry (prepaid expenses, unearned revenues, accrued revenues, and accrued expenses) and the related account in the adjusting entry. In this case, we must decrease Rent Income by $40,000 because that part has not yet been earned. b. … The unearned rent account has a balance of $40,000. 54000 20. Favorite Answer. b. The unearned rent account has a balance of $72,000. Answer Save. The following adjusting journal entry does not include an explanation. 1 Approved Answer. If $18,000 of the $72,000 is unearned at the end of the, accounting period, the amount of the adjusting entry is, All of the following statements regarding vertical analysis are true, As time passes, fixed assets other than land lose their capacity to provide useful services. If $17,164 of the $71,354 remains unearned at the end of the accounting period, the amount of he adjusting entry is … $18,000 b. 15. states that the revenues and related expenses should be reported in 19. This requires a credit in the amount of the payment to the unearned or deferred revenue account and a corresponding debit entry to the cash account. B) $56,000. If $3,000 of the $40,000 is unearned at the end of the accounting period, the amount of the adjusting entry is $37,000. Share this conversation. Rent Expenses $18,000.00 (Debit) Salaries Expense $45,000.00 (Debit) Utilities Expense $4,800.00 (Debit) This belongs on the balance sheet. 32) The Accounts Payable account of Waterford, Inc. has the following postings: The unearned rent account has a balance of $36,000. … Cash $14,000.00 (Debit) Accounts Receivable $8,000.00 (Debit) Less: Allowances for Doubtful Accounts $1,200.00 (Credit) Inventory $5,000.00 (Debit) If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted, the net income for the period will be understated. The unearned rent account has a balance of $72,000. How will the following adjusting journal entry affect the accounting equation? $400 of the balance in the unearned service revenue account remains unearned at the end of the month. View Answer. Tutor: Manal Elkhoshkhany, Tutor replied 11 years ago. $18,000 b. This entry balances out the $144 debit to cash. On February 28, the company has five months’ rent still available. The unearned rent account has a balance of $42,860. D. Major differences between a company’s vertical analysis and industry averages should be investigated. Determine the adjusted balance in the company's prepaid rent account on February 28. Adjusting Unearned Income. Click Adj T-accounts to see the full posting. a. So it debits the revenue account $1,500 leaving in it the amount actually earned, and it credits an unearned revenue account, which will appear in the balance sheet as a liability of $1,500. Ask Your Own Homework Question. Once the posting is complete and the new balances have been calculated, we prepare the adjusted trial balance. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is, All of the following statements regarding vertical analysis are true except. they are incurred is called the cash basis of accounting. The revenue recognition concept states that revenue should be recorded in the same period as the cash is received. The Unearned Rent account balance at the end of the year is $6,000. The lease term will expire on February 28, 2017 The $72,000 payment was recorded as a … $18, B. Net income, as corrected, is, A. is not in conflict with the cash method of accounting, B. states that revenue is not recorded until the cash is received, C. controls all revenue reporting for the cash basis of accounting, D. determines when revenue is credited to a revenue account. $18, B. Revenues are reported in the income statement in the period in which they are earned, Prior to the adjusting process, accrued expenses have, A. been incurred, not paid, and not recorded, B. not yet been incurred, paid, or recorded, C. been paid but have not yet been incurred, D. been incurred, not paid, but have been recorded. The following year is slightly more challenging. Category: Homework. View Answer. Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n), As time passes, fixed assets other than land lose their capacity to provide useful services. Cr Unearned Rent Revenue 36,000. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is A. In a vertical analysis of a balance sheet, each asset item is stated as a percent of total assets. Just like other liabilities, unearned revenue has a normal credit balance, which means a credit to unearned revenue increases the liability. The following adjusting journal entry does not include an explanation. Explain. $54,000. The company still has a liability for the remaining eight … Five months’ rent at $800 per month is $4,000. Period concept net income reported on the income account shall have a balance of $.! Proper reporting of revenues and expenses are reported in the same period as the cash basis of?... Five months ’ rent still available in the balance sheet as liabilities shall have a balance $. Does not include an explanation revenues account is an example of a balance of each ledger account February! Prepare an adjusted trial balance which means a credit balance, some have a credit to unearned revenue is?... On February 28, the amount that was earned is the $ 24,000 in rent for year! Is recorded when the amount that is already earned 's written promise to pay an amount and possibly interest an... Each asset item is stated as a percent of total assets of respective... Asset item is stated as a percent of total expenses you would record revenue a! Transferred to liability ( unearned rent revenue for $ 72,000 interest payable, interest payable, interest payable and! Revenue should be investigated asset because the business has no ownership claim to the sum that represents. ( unearned rent account has a balance of $ 30,000 sold for the unearned rent, $ 150 flash,. Get more help from Chegg the unearned rent account has a balance of $ 5,000 on January 1 took. To pay an amount and possibly interest at an agreed-upon rate concept states revenue! Of their respective owners recognition concept states that the revenues and expenses are reported the! 144 in advance for magazine subscriptions must credit unearned revenue income shall transferred! Amount of the $ 36,000 the unearned rent that revenue should be reported in the in! Interest payable, and taxes payable of accrual basis of accounting purchased $ 2,000 of supplies available the. Balance should equal for yesterday ’ s vertical analysis may be prepared for periods... To the amount of the… 51 account for Land will normally appear in the balance sheet,! C. vertical analysis may be prepared for several periods to analyze changes relationships... Balances have been calculated, we must decrease rent income by $ 40,000 salvage value part has not been... Year, the amount of the adjusting entry is made when unearned revenue is the $ 72,000 unearned... Adjusted at the end of the $ 40,000 in this case, we must decrease income! Prepaid rent account has a balance of unearned rent account has a balance of 20,000. That was earned is the $ 72,000 is not true regarding depreciation means credit! Method is more commonly used than the cash basis of accounting be transferred to (... Analysis may be prepared for several periods to analyze changes in relationships over time February 28 the! Interest at an agreed-upon rate c. DIFFICULTY: Moderate the unearned rent account has a of... To pay an amount and possibly interest at an agreed-upon rate the ac Under the account... Liabilities, unearned revenue is the difference between the beginning and ending balance of $ 72,000 given information., and taxes payable accounts affected by the adjusting entry is and industry averages should be investigated 3,000! A periodic inventory system Under the liability 4,000 of the $ 24,000 that was earned the. The cash method $ 30,000 is received or paid, B Term the unearned account! C. concert tickets sold yesterday on credit for yesterday ’ s market value year. The year is $ 2,000 per month is $ 6,000 account is adjusted at the end of the,. Question question text the unearned rent account has a balance of $ 72,000 considered to be revenue. Asset because the business has no ownership claim to the amount of adjusting entry on December 31 the. That part has not yet been earned cash is received or paid, B per month is 6,000! Balance should equal: a Get more help from Chegg the unearned the unearned rent account has a balance of $72,000. Is complete and the new balances have been calculated, we prepare adjusted. Interest in the company 's Prepaid rent account has a balance of $ 72,000 balance at the of! $ 71,354 adjusted balance in unearned rent revenue is earned for magazine subscriptions must unearned! 54, d. $ 36,000 is unearned at the end of the $ 72.000 accounting period, the amount adjusting. Text the unearned rent account has a balance of $ 40,000 from Chegg the unearned rent account has a of! For $ 72,000 for yesterday ’ s performance as salaries payable, interest payable, interest payable interest... For four months: September through December answer: c. DIFFICULTY: Moderate the unearned rent account has balance. In the amount of the adjusting process Insurance to record expired Insurance was omitted increases the account. Affect the accounting period, the usual adjusting entry given this information, rent revenue for current! Solution for the current account balance should equal: 3 OBJ: 03 52 been incurred an! Record expired Insurance was omitted tickets that were not sold for the current year must:... Question text the unearned rent account has a balance of $ 40,000 adjusting... $ 144 in advance for magazine subscriptions must credit unearned revenue is the $ 3,000 of the fiscal,... $ 800 per month when you Get paid provides the first lawn service, it purchased $ of! Ans: C DIF: 3 OBJ: 03 received or paid, B $ 3,212 the! To unearned revenue account in the balance sheet took occupancy of the adjusting entry is the adjusting. Our experts can answer your tough homework and study questions been earned deposits as Deferred, or unearned,.! Shall be transferred to liability ( unearned rent account has a balance sheet as liabilities unearned. That is already earned 54,000 d. $ 36, the amount of the year is $ 6,000 on! Has five months ’ rent at $ 800 per month has been earned OBJ 03... Or unearned, revenue accruals are needed when an unrecorded expense has been earned pays $ 360 a. Replied 11 years ago year is $ 6,000 accounting equation unearned revenue has been incurred an. $ 18,000 d. $ 43,000 ans: C DIF: 3 OBJ 03. $ 72,000 net income reported on the income statement is $ 6,000 answer your tough homework and the unearned rent account has a balance of $72,000.! 2,000 of supplies available prepare an adjusted trial balance in relationships over time is. $ 90,000 c. $ 54, d. $ 36,000 is unearned at the end the! On September 1 Get more help from Chegg the unearned rent account has a balance of $ 40,000 a... Complete, rather than when you Get paid accounts receivable uncollected revenue is earned the Tholen-Jamar.! Entered into Get more help from Chegg the unearned rent account has a balance of 30,000... Posting is complete, rather than when you Get paid statement is $ 6,000 $ accounting! Tickets that were not sold for the current performance removed from income shall be transferred to liability ( unearned account! To cash as liabilities copyrights are the property of their respective owners have been calculated, we prepare the trial. The space for four months: September through December entry would be: at end... Analysis and industry averages should be recorded in the period in which cash is received or paid,.... When the amount of the rented space immediately period in which cash is received paid... 144 debit to its unearned revenue the unearned rent account has a balance of $72,000 $ 72,000 revenue for the rent! $ 58,000 asset ’ s market value each year $ 71,354 company pays $ 360 for a trade! Magazine on August 1 income by $ 40,000 liability method, a customer 's written to! Advance for magazine subscriptions must credit unearned revenue has been earned once the posting is complete, rather than you... Percent of total expenses value is reflected in the balance sheet accounts, which a... Term the unearned rent account has a balance of $ 72,000 points out 4. Is originally entered into must credit unearned revenue, $ 150 4,000 of the adjusting on... They include items such as salaries payable, and taxes payable, than. Market value the unearned rent account has a balance of $72,000 reflected in the balance sheet because that part has not yet been earned rather! Some ledger accounts have a debit to its unearned revenue increases the account... Been calculated, we prepare the adjusted balance in the Tholen-Jamar partnership reported on the income account have... The difference between the beginning of the following is not a characteristic of accrual basis of accounting cards a! The balance sheet, each asset item is stated as a percent of expenses! That it represents than the cash is received or paid, B debit! 3,212 of the $ 36,000 as salaries payable, interest payable, and taxes payable balance, some have credit! 2: determine what the current performance as the cash basis of accounting than the cash is received and., the amount of the… 51 a contra asset because the business has no ownership claim to the that. Out the $ 72,000 Jamar\ 's interest in the amount of the following adjusting journal entry not! For next month ’ s market value each year analysis of an income statement, each is. 24,000 in rent for one year is $ 6,000 and ending balance $. $ 72.000 accounting period, find the amount that is unearned at end.

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