Asked by
rosen pierre
on Oct 16, 2024
Verified
On October 1,Vista View Goodwell Company rented warehouse space to a tenant for $2,500 per month and received $12,500 for five months' rent in advance on that date,with the lease beginning immediately.The cash receipt was credited to the Unearned Rent account.The company's annual accounting period ends on December 31.The Unearned Rent account balance at the end of December,after adjustment,should be:
A) $5,000.
B) $7,500.
C) $12,500.
D) $2,500.
E) $10,000.
Unearned Rent
Income received for rent that has yet to be earned, typically because the service period has not yet been completed; it is recorded as a liability.
Adjusting Entry
Journal entries made in an accounting period's end to allocate revenues and expenses to the period in which they actually occurred.
- Detect and chronicle adjusting entries for accrued revenues and expenses, with emphasis on their effect on financial statements.
Verified Answer
TG
Learning Objectives
- Detect and chronicle adjusting entries for accrued revenues and expenses, with emphasis on their effect on financial statements.